Shares of the budget retail chain Dollarama (TSE:DOL) were trading 1.63% higher as the company approached a capitalization of over C$10 billion after a six year run on the market, where it opened with an IPO of C$1.3 billion.
This is a significant milestone for the Quebec based company, whose earnings have grown at a rate of 21.8% over the past five years, according to BMO Capital Markets, in spite of having to confront competition from giants like Walmart or Canadian Tire and even Target for a brief period.
The retail chain, which could rely on 585 shops at the time of its IPO, will open soon open its 1000th location.
The company founded in 1992 still has a good growth potential according to analysts. It is targeting an expansion that will each 1,400 stores across the country.
Dollarama is also considering expanding abroad, particularly in Latin America where it has formed a partnerships with the Dollar City chain, which operates 25 stores in El Salvador and two in Guatemala. Dollarama’s management is already studying ways to ensure that its business model will be exported successfully.