Why Hemang Jani is recommending buying this decline in Avenue Supermarts

economictimes.indiatimes.com:

«The fact that there is a 4% kind of a decline in the revenue and even on many other parameters whether you look at sales to customer or footprint addition in this quarter or revenue per square feet there is definite amount of disappointment,» says Hemang Jani, Equity Strategist & Senior Group VP, MOFSL.We were just highlighting Vendant Fashion’s numbers and just looking at how the same store sales etc performance has been that kind of falls short of the valuations that the stock quotes at, I mean the margins have come in at 47.5% while standalone they may be okay but in the same quarter last year they did over 50%. The PAT has come in at Rs 92 crores rupees odd, the revenues have come in a little lower by about 4%. It seems like it was not the most profitable quarter for them. Absolutely.

The fact that there is a 4% kind of a decline in the revenue and even on many other parameters whether you look at sales to customer or footprint addition in this quarter or revenue per square feet there is definite amount of disappointment. I think partly it is because of the shorter wedding season but we think that some of these companies are over hyped because of their focus on a certain niche category and the fact that market would expand in a big way but I think at these valuations and given that the numbers are not really delivered there is going to be some amount of de-rating when it comes to Vedant Fashions.What are one or two stocks you have added in the quarter gone by? My largest bet is National Stock Exchange.

I think it is not listed as yet. But given the way things have really moved on the turnover front and the GIFT Nifty being operational, clocking high volumes.