Trent’s Zudio can lease any commercial building and start operations right away. but DMart has to own land construct building and open a full fledged store to operate. We cannot compare Zudio’s growth with DMart’s GM&A segment. If you look at the margins both operate an a similar operating margins of around 15-16%.
High inflation, lower consumer discretionary spending can be attributed to the slower growth, but in the long run DMart’s footfall can become a major competitive advantage over Trent.
My personal shopping experience with Zudio is mostly like one time visit, to experience the new store and new merchandise, the quality is sub par. Once the newer stores mature, the footfalls will be stagnant, same-store sales growth will decline and lease rental expenses will hit the margins hard in the long run.
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