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Trent shares fall: What drove investors away from the Tata Group firm?
Trent is known for its diverse portfolio of brands, including Westside, Zudio, and Star Market.
Shares of Trent Limited tumbled in the trade on Friday, just a day after the company held its annual general meeting (AGM).
The retail firm’s stock fell more than 11 percent, trading at ₹5,497 at noon. Trent is a Tata Group firm and a leading retail company in India.
Trent is known for its diverse portfolio of brands, including Westside, Zudio, and Star Market. It operates in various retail formats, including fashion, lifestyle, and grocery, and has been recognised for its strong growth and performance in the retail sector.
With such a strong base, what exactly happened that spooked the investors, leading to a bloodbath on Friday?
Trent shares fall: Here's what drove investors away
The stock of Trent Limited came under selling pressure as analysts were hoping for a bigger growth than the company had and were left disappointed with the company's growth update for quarter 1.
Trent revealed that its standalone revenue grew 20 percent year-on-year to ₹5,061 crore for Q1 in the current fiscal year. That is lower than the expected 25 percent that the firm has targeted to achieve over the next few years. The company revealed that its store portfolio included 248 Westside, 766 Zudio (including 2 in the UAE), and 29 stores across other lifestyle concepts.
According to analysts at Nuvama, a pickup in Zudio Beauty and the Star business can become the next big growth levers, but these businesses need to stabilise before scaling up.
According to its plans for the current financial year, Trent is adding 250+ stores in all formats combined. It might add more if it gets suitable market conditions and more investable properties.
Nuvama’s analysts have cut Trent's revenue estimates by -5 percent for the current financial year and by -6 percent for FY 27 and the estimated gross operating profit by -9 percent and -12 percent, respectively.
Trent highlighted in its own report for investors that the last fiscal year was a relatively challenging period for retail in India. Multiple factors, including inflation, impacted discretionary spending in the sector.
