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Informist, Friday, Nov. 14, 2025

 

--Vishal Mega Mart:Passing on full GST cut benefit for own, 3rd-party brands 

--CONTEXT: Comments by Vishal Mega Mart's mgmt in post-earnings analyst call 

--Vishal Mega Mart: Don't expect hit in avg bill size due to GST rate cut 

--Vishal Mega Mart: 1.5% to over 9% of sales at stores from quick commerce 

--Vishal Mega Mart: At current inflation levels, no plans to increase prices 

--Vishal Mega Mart: To keep upgrading merchandise beyond current price range 

--Vishal Mega Mart: Have enough cash on balance sheet to fund investments 

--Vishal Mega Mart: Endeavour to increase revenue share from own brands 

--Vishal Mega Mart: FMCG contributes over 70% to quick-commerce sales 

--Vishal Mega Mart: Share of FMCG in store sales 27-28% 

 

By Shakshi Jain and Arya S. Biju

 

MUMBAI – Vishal Mega Mart Ltd. does not plan to increase prices if inflation remains at the current benign levels, a top company official said in a conference call with analysts and investors Friday. "..in the organised retail (space), we will be the most competitive in terms of opening price point, which can be easily compared across retail," the official said. 

 

The company, however, plans to continue to upgrade its merchanise and introduce new and more aspirational products beyond the current price range. It will also continue its endeavour to increase the revenue share from its own-brand product lines, as against third-party brands. 

 

In the first six months of 2025-26 (Apr-Mar), around a quarter of the company's sales came from products of third-party brands.

 

Vishal Mega Mart is passing on the full benefit of the recent Goods and Services Tax rate cuts to customers, for both its own brand as well as third-party brands. The management does not expect a fall in the average customer bill size due to the indirect tax cut as it expects the new tax structure to result in higher volume from some customers, while allowing others to move to more aspirational categories of products amid rising affordability.

 

"...my assumption at this moment is that it would not impact our average bill value at all, because I'm also quite optimistic that this will lead to an increase in overall consumption. So, we anticipate one of the two scenarios, and most likely both will play out with different customers," the management said.  

 

Vishal Mega Mart's management also said the company has sufficient cash on the balance sheet to fund its investments.   

 

QUICK-COMMERCE PLAY

Currently, anywhere between 1.5% to over 9% of the revenue at Vishal Mega Mart stores is from the quick-commerce business. "Once we are fully rolled out and matured in all the stores, which have all been recently added, we would have a better overall number for this," the management said.

 

Fast-moving consumer goods have been a strong driver for quick-commerce sales, contributing over 70% of the revenue, the management said. Meanwhile, the category contributes about 27-28% to the revenue at the retailer's stores. As a result, gross margins are lower in quick-commerce sales. 

 

The retailer joined the quick-commerce bandwagon after testing a pilot, and is gradually expanding the service across its stores. In the September quarter, it expanded the service to include a total of 695 stores with hyperlocal delivery across 460 cities. 

 

At 1436 IST, shares of the company were down 0.4% at INR 137.61 on the National Stock Exchange.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Avishek Dutta

 

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