After posting 2.4 per cent growth in January and February, the loss in sales during March, because of the pandemic, led to a 16 per cent YoY fall in SSS in the March quarter.
Shoppers Stop’s SSS performance was worse than Westside and Pantaloons, both of which reported a fall of 7-12 per cent on that metric.
Analysts at Motilal Oswal Financial Services expect the lifestyle apparel segment to see a greater impact, given the higher ticket size, amid down-trading by customers.
Limited product differentiation, online competition, and a higher number of stores in malls could see sales slump, due to lower footfall. The lower share of private labels, coupled with the weak positioning vis-à-vis Pantaloons and Westside (in the sub-Rs 1,000 merchandise category) is a negative, they add.
While the earnings trajectory for the next year is expected to remain weak, the stock, which has gained 26 per cent over the past month, is trading at expensive valuations.