Electronics Mart CFO Says Festive Sales Drove Double-Digit Growth, Eyes Wedding Season Now

Electronics Mart India Ltd. Chief Financial Officer Premchand Devarakonda believes that the road ahead looks encouraging, especially with the wedding season around the corner. 

In an exclusive interview with NDTV Profit, Devarakonda blamed the monsoon and Shradh period for affecting the sales in the July–September quarter of the ongoing fiscal.

"There has been heavy rainfall in the region that we have been operating that reduced the footfall drastically. Additionally, the Shradh period—a time considered inauspicious for purchases has also played a role in dampening the same sales growth. However, the scenario is set to improve in the next few quarters," he said.

Devarakonda is optimistic about the same sales growth in the upcoming quarters due to festive sales and the wedding season. "SSG will be close to 8% in the upcoming quarters that is the target and that we are working towards. And the topline growth at the company level will be 15% for the year and that is easily achievable," he said.

Explaining the reason behind the dull sales performance, the electronics retailer's CFO said, "When footfall is low, customers miss the touch-and-feel experience, and sales of high-end and large appliances decrease compared to previous quarters."

However, Devarakonda added, "the festive season that began on Oct. 3 has already shown a promising uptick in sales. The wedding season is quite encouraging. We can see double-digit growth already in the recently completed festive season."

While replying in the negative on whether Electronics Mart plans to build an e-commerce portal, he added, "But of course, we have been selling on Amazon and Flipkart portals, and that will continue. We do not have plans to build our own e-commerce portal."

On the reason behind the lower Q2 margins, he said, "Lower foot traffic inevitably impacts margins because store operating costs remain fixed, apart from sales incentives." However, he added, "These costs can be absorbed as demand picks up over the subsequent quarters."