The owner of the Poundstretcher chain has set out plans to "modernise and update" its stores as part of a review aimed at boosting profitability.
Instore will remain focused on the value sector, while withdrawing from those sites that fail to meet expectations.
Shares jumped 16 per cent, up 43.4p from to 321.4p.
Investors welcomed the strategy, as well as an update showing like-for-like sales were up 7.3 per cent in the past 24 weeks.
The Huddersfield-based company will retain both the Instore and Poundstretcher trading names after chief executive Trevor Coates reversed a plan by his predecessor to scrap the Pound-stretcher brand and replace it with Instore.
The Poundstretcher estate will be the focus of modernisation as the previous plan to convert to Instore meant many stores went without investment.
Among other changes, the company will continue to scale back its offering in the highly-competitive clothing market, as part of attempts to refocus the operation back on its strengths as a value-led convenience retailer.
While the 7.3 per cent improvement in like-for-like sales is consistent with the 7.1 per cent growth reported in April, analysts pointed out that year-on-year comparisons had toughened since the previous figure was announced. The company fell £3.3 million into the red last year.
Mr Coates, who took over the helm from Angus Monro in March, stands to net £6 million from share options if his three-year turnaround plan pushes the company's share price above 60p.
Former Matalan boss, Mr Monro, quit the group after it announced a "significant shortfall" in sales from the four weeks to February 11, with a flat like-for-like figure.
Earlier in the year he was forced to admit that operating costs ran over budget because of investment in a new distribution centre.
Instore's new chief executive set up the UK arm of Aldi and established an estate of 200 stores before moving to Australia, where he spent the past five years running a food conglomerate.
