The market didn't care about the top line. V2 Retail Ltd. shares nosedived 18% on Monday, October 5, closing at ₹165.01 on the BSE and NSE. That’s the steepest single-day drop since March 2020. The trigger? A business update that revealed a stark contrast between aggressive expansion and stagnant organic demand.
For the September quarter, standalone revenue hit ₹905 crore, up 28.4% from ₹705 crore a year earlier. On paper, that looks healthy. But traders zeroed in on the same-store sales (SSS) figure: 0.5% growth on a festive-normalized basis. The company noted that the base quarter included Navratri and Durga Puja, but those festivals have shifted to the current October-December period. On a calendar basis, SSS was 14.9%, but that metric is useless when comparing a festival-heavy quarter to a non-festival one.
"This timing shift underscores the importance of looking through seasonal distortions to see the underlying stability of our performance," the company stated in its filing. Monthly sales per square foot stood at ₹700, excluding the festive spike. The real issue is the ramp-up of new inventory. V2 opened 49 stores and closed three in Q2, taking its total to 427 locations and 46.28 lakh square feet of footprint. 106 of those stores opened in the first half of the fiscal year. New stores dilute average sales per square foot until they mature.
The expansion strategy targets tier-2 and tier-3 cities, where consumption is growing but slower to reach peak efficiency. Meanwhile, the company soft-launched V2Kart in Delhi NCR and Lucknow in September, fulfilling orders directly from stores. It’s a bid to capture e-commerce volume without building a separate logistics network. But investors are skeptical. The stock is down 33% year-to-date.
The next test is Q3 results. With Navratri and Durga Puja now in this quarter, the festive-normalized SSS will be the key metric to watch. If organic growth remains flat, the market will question whether the revenue growth is purely volume-driven from new locations. Analysts will be scrutinizing the ₹700 per square foot figure to see if it holds steady once the festive season kicks in.