Now Reading: Vishal Mega Mart reappoints CEO Kapur till 2031, stock dips 2%
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Vishal Mega Mart reappoints CEO Kapur till 2031, stock dips 2%
Vishal Mega Mart's board has reappointed Gunender Kapur as managing director and chief executive officer for five years from 1 September 2026, removing a key uncertainty flagged by analysts. The stock fell…
Vishal Mega Mart's board has reappointed Gunender Kapur as managing director and chief executive officer for five years from 1 September 2026, removing a key uncertainty flagged by analysts. The stock fell about 2% on Tuesday after surging 10% on Monday following the announcement.
Motilal Oswal had earlier identified Kapur's tenure beyond June 2027 as a key-man risk. The reappointment comes amid management churn and promoter stake sales. Promoter Samayat Services LLP, backed by Kedaara Capital, cut its holding from 54.1% to 40.1% in February, down from 76% at listing in December 2024. Institutional buying has partly offset the selling, with mutual fund holdings rising to 30.6% as of June.
Fundamentals remain strong. June quarter revenue rose 19% year-on-year to Rs 3,730 crore, with same-store sales growth of 10%. The company added 24 stores, taking its network to 819 stores across 559 cities and retail space to 13.8 million sq. ft. Ebitda margin held steady at 14.6%. The company's quick-commerce expansion and a plan to reach 3,000 small-format stores will be monitored for execution.
Indian Opinion Analysis
Kapur's reappointment removes the single biggest overhang flagged by analysts, but the stock's valuation at 42 times estimated FY28 earnings leaves little room for error. The promoter holding has fallen from 76% at listing to 40.1%, and another large tranche of shares became tradable after lock-in expiry in July, keeping supply pressure alive. The company's plan to scale small-format stores to 3,000 from the current base is ambitious: the model works at single-store level, but execution at that scale is untested. The next data point to watch is same-store sales growth in the December quarter, which will show whether demand is recovering as inflation eases or whether competition from DMart, Zudio and quick-commerce players is biting.
Source: livemint.com
This brief was synthesised by AI from the source linked above.
