Shoppers Stop shares fell 5.4% to 363.15 rupees after the retailer reported same-store sales growth of 2% for the second quarter, a sharp dip from 6% in the previous quarter. While the company turned a net profit of 31.1 million rupees against a loss a year ago, investors reacted to the cooling consumer demand, which management attributed to a shift in the festive calendar.
Shoppers Stop saw its share price decline by 5.4% to close at 363.15 rupees following the release of its second-quarter earnings. Investors focused on the company’s same-store sales growth—a key metric measuring sales from stores open for more than a year—which slowed to 2%. This is a significant decline from the 6% growth reported in the previous quarter and the 9.4% growth achieved in the same period last year, signaling a cooling in consumer interest.
The company’s management attributed this slowdown primarily to a shift in the festive calendar, which moved peak shopping days outside of the July-September quarter. When adjusted for this timing, the management stated that same-store sales growth would have been 7%. While festive timing often impacts retail performance in India, the market remains sensitive to any signs of weakening discretionary spending.
On the financial front, the company reported a consolidated net profit of 31.1 million rupees, a recovery from the 201.1 million rupee loss reported in the same quarter last year. Revenue from operations also saw growth of 8.7%, reaching 13.7 billion rupees. This suggests that while total revenue is increasing, the pace of growth in existing stores has become a point of concern for investors.
Shoppers Stop continues to emphasize its premium segment, which grew by 10% during the quarter. This is part of a broader strategy to move toward higher-value products, with the premium segment now making up 73% of the company's total sales. By shifting its product mix toward more expensive offerings, the company is attempting to protect its margins even as footfalls face pressure. However, the broader retail sector in India is navigating a period where shoppers are increasingly cautious with their spending.
Competition from both large organized retailers and the rapid rise of quick-commerce and e-commerce platforms adds further pressure to the traditional retail model. For investors, the key monitorable will be whether the sales momentum recovered during the actual festive period in the third quarter. The company's ability to maintain demand for its premium offerings, despite general sensitivity to seasonal timing and economic conditions, will be critical to track in upcoming results.