Retailers, except apparel sellers, achieve pre-Covid sales in Q3

As most retailers, except apparel sellers, returned to pre-COVID-19 sales levels in the December quarter, brokerage firm Edelweiss Securities said the focus would remain on business fundamentals and e-commerce presence in Jan-Mar.

Retailers will also reap the benefits of a favourable low base as operations were affected by lockdowns in the same period a year ago to control the spread of coronavirus.

Going ahead, the focus will again shift to business fundamentals, with higher e-commerce presence being the incremental factor to evaluate, the brokerage house said.

Most retailers had made the shift to e-commerce platforms as footfalls in brick-and-mortar stores had fallen sharply due to the COVID-19 scare and social distancing norms.

The October-December quarter saw sales recovering to pre-COVID-19 level across most categories, which along with cost-cutting measures, aided the operating margins of retailers by around 20 basis points on year.

In terms of the pecking order, the innerwear segment posted the highest growth, followed by jewellery, grocery retail, quick-service restaurants and apparel retail, the brokerage firm said.

Highlighting some key trends seen in the industry, the brokerage house said that recovery in rural and semi-urban parts of the country outpaced that of cities.

Demand for jewellery remained robust in October-December and is expected to gain better traction due to the wedding season in January-March, Edelweiss Securities said.