Introduction:

By the late 1990s, our founder, Mr. Radhakishan Damani, was already established as one of the more
successful and well-known value investors in the Indian equity markets. DMart, our retail chain, was
conceived by him in the year 2000. A focus on financial fundamentals, high levels of patience and strong
conviction have been the bedrock, on which the Company’s values and business direction have been
built.

VISION & MISSION:

At DMart, we continuously research, identify and make available new products and categories to fulfil
our customers’ everyday needs at the best value. Our mission is to be the lowest priced retailer in our
area of operation.

Key Points of increased revenue and profit:

176 total Stores in 2018-19 compared to 155 stores in 2017-18.

During the financial year, India continued to perform well with a 6.8% growth rate (Source: National
Statistical Office). Two levers largely drive India’s growth – robust government expenditure and rising
domestic consumption levels. The government is strongly focusing on infrastructure development and
much-needed structural reforms that eliminate bottlenecks and spurs investment. The latter however, is
led by an aspirational, increasingly affluent middle-class enabled by rising disposable incomes. Large-
scale technology adoption, urbanisation and a shift to branded products have changed the face of
India’s retail.

We continue to invest in the green building energy project with the help of IGBC and USGBC. We now
have 50 locations that are Gold certified Green Buildings. A green building as per IGBC/ USGBC is one
where a significant effort has been made from the time of construction to ensure the environment
impact is minimal during construction and future operations. We have also made some good progress in
using solar energy in new stores as well as existing stores which have infrastructure to support
harnessing solar energy – 46 of our 176 stores have solar panels with a commissioned capacity of 4.2
MW.

Our CSR programme has made good progress and has positively impacted more than 95,000 students in
the municipals schools of Mumbai this year. Our focus remains on improving the overall infrastructure
and providing better learning aids to these schoolgoing children
GREEN BUILDING CERTIFICATION

Green building refers to both a structure and the application of processes that are environmentally
responsible and resource-efficient throughout a building’s life cycle: from planning to design,
construction, operation, maintenance, renovation and demolition. We have obtained Gold Certified
Green Building Certification for 23 additional stores this year taking our total to 50 stores (covering more
than 2.3 million sq. ft. of development). This certification is Our organisation continues to be aligned on
our core objectives of Judicious use of natural resources Reducing our carbon footprint Minimal
environmental impact Each day we strive hard to carry out our business within this core framework to
make our operations clean and sustainable, thereby reducing our impact on the environment. Rooftop
Solar Panels issued by the Indian Green Building Council (IGBC) under New Buildings Rating System (for
46 properties) and US Green Building Council under Leadership in Energy and Environmental Design
rating system (4 properties). There are several factors which are considered for awarding this
certification. Some of those are elaborated below in detail (including our efforts within those factors):

1. Energy Efficiency Renewable Energy Use – We have continued to install rooftop solar plants at several
of our existing and new projects. We have a total commissioned capacity of 4.2 MW on the rooftops of
46 of our stores. Other Initiatives • LED fixtures are installed at our stores to reduce overall energy
consumption • CFC-free refrigerants are used in our air conditioning equipment to reduce emission of
greenhouse gases • BEE 5-Star rated split air conditioning units are installed in all our offices to reduce
overall energy consumption

2. Water Conservation • We have installed low-flow waterefficient fixtures at our stores. These have
aerators fixed by default to maintain and regulate water flow • We have developed rainwater harvesting
pits to collect rainwater run-off and harvest it (through groundwater recharge). This helps in addressing
the issue of groundwater depletion • At several of our stores, we have installed Sewage Treatment
Plants (STPs) to recycle water and reduce the usage of local water supply. Treated water is used in our
toilets for flushing • We have installed waterless urinals on a pilot basis at some locations. If feasible, we
will replicate this across all our stores

3. Sustainable Building Material Usage of AAC Blocks – We encourage the usage of Autoclaved Aerated
Concrete (AAC) Blocks, which contain up to 65% of recycled material, for construction of our stores.
These blocks use fly-ash – a large pollutant byproduct of thermal power plants. Ready Mix Concrete
(RMC) – We strive to procure RMC and AAC Blocks from locations closest to our construction sites. In
addition, we always encourage usage of fly-ash (within permitted limits) in our RMC which is used in our
building construction.
Management Discussion and Analysis:

ECONOMIC OVERVIEW
During FY 2018-19, India continued on a strong growth path and is expected to grow at a healthy 6.8%
(Source: National Statistical Office). This is on the back of increased government expenditure, growing
consumption rates and structural reforms.
The Goods and Services Tax (GST) rolled out in 2017 has shown encouraging progress in the overall
collection of indirect taxes and has crossed `11.7 lakh crore in FY 2018-19 (Source: Finance Ministry).
GST has made large inroads in formalising the economy and has created a level-playing field for all
businesses.
India’s headline inflation figures remained under targeted levels during the year and this has given the
Reserve Bank of India headroom to adopt a calibrated approach to monetary policy easing. The last two
monetary policy announcements witnessed back-to-back rate cuts and this is expected to spur further
economic activity in the country.
Other fundamentals in the economy remained robust, with forex reserves maintained above $400
billion level, India’s ease of doing business ranking soaring and direct tax collections also crossing `10
lakh crore in FY 2018-19.

Outlook
India’s economy is expected to continue on this growth path, with bodies like the International
Monetary Fund (IMF) expecting the economy to grow at 7.3% in FY 2019-20. Robust consumption
growth and prudent fiscal policy are expected to act as enablers of this growth. The government’s
infrastructure focus and the continued implementation of announced policies and programmes will also
provide impetus to the nation’s growth.

2. INDUSTRY OVERVIEW (INCLUDING OPPORTUNITIES AND THREATS)

India is a burgeoning market which is driven by large-scale domestic consumption. The retail segment is
witnessing a significant shift and is growing rapidly to reach a market size of $960 billion by FY 2020.
Primary drivers of this growth will be rising income levels, lifestyle changes adopted by an increasingly
affluent middle class and increased digtalisation and technology adoption.
India has also seen a significant growth in the number of internet users; consequently the e-commerce
market has also seen the positive impact of this penetration. The country is witnessing some large-scale
investments in this market. E-commerce would form 4%-6% of the total retail market, whereas
organised retail would take up 12% at the end of FY 2019-20. The rest is attributed to traditional retail,
which will witness gradual adoption of organised retail practices, driven by measures such as GST.
The government has adopted a liberal Foreign Direct Investment (FDI) policy in both single and multi-
brand retail and this would further boost retail investments in the country. This has already attracted
sizeable investments, either as greenfield investments or as facilitators of consolidation via acquisitions.
Growing investments would certainly expand the retail market offerings and would bring better
products and services to discerning Indian consumers.
Economic headwinds (such as GDP slowdown, decreased rural spending, rising commodity prices) and
growth of e-tailing industry are the key threats to the organised brick and mortar industry. Organisations
will have to continue to remain agile and adaptable to mitigate such threats.