Citi set a target price of Rs 9,250 for the stock, signaling a 21% upside from the previous closing price, and added it to its Pan-Asia high-conviction focus list. Citi’s report highlighted Trent’s ability to leverage its supply chain and insights from its flagship brands, Westside and Zudio, while also successfully turning around its Star Bazaar grocery business.
Trent’s profitability, particularly its impressive growth in same-store sales and gross margin expansion, reflects its strong position in the retail sector (Zudio, Westside, Star Bazar).
The stock has seen impressive growth, rising 463% over the last two years and gaining 269% in just one year. Over the past three years, Trent has delivered a remarkable 702% return to investors.
Trent is well-positioned to scale up other pilot projects like MISBU, Samoh, and its joint venture with MAS Holdings.
Once a single-format player, Trent has evolved into a multi-format retailer. This transformation has driven a 36% compound annual growth rate (CAGR) in revenue between FY19 and FY24.
As a diversified player in fashion, lifestyle, grocery, and personal care, Trent is projected to lead the industry with revenue, EBITDA, and PAT CAGRs of 41%, 44%, and 56%, respectively, from FY24 to FY27.
Trent Ltd has been showing strong momentum in recent months, driven by robust earnings and expansion strategies. Following its Q1 2024 results, the stock surged 19% over just six trading sessions, reaching record highs of ₹6,750 per share and approaching the ₹7,000 mark. Analysts have raised their target prices, with some forecasting levels as high as ₹7,136. This optimism is backed by Trent’s aggressive store expansion, especially its Zudio brand, and improved performance across multiple retail segments. Sales growth and revenue per square feet: You can look at the historical sales growth of the company in order to forecast the future sales of the company. Sales for the current year of Trent is Rs 11,926.56 Cr. The compounded sales growth of the past three years of Trent is 79.93 %.
Operating Margin: This will tell you about the operational efficiency of the company. The operating margin of Trent for the current financial year is 16.54 %.
Current Ratio: This is the working capital ratio that will tell you whether the company is generating enough cash for the working capital requirements. The current ratio of Trent is 1.96 as of this year.
Return Ratios such as Return on Assets (ROA), and Return on Equity (ROE) of Trent are 18.44 % and 38.15 % respectively for the current year. 3-year average ROE is 22.27 %.
Dividend Yield: – It tells us how much dividend we will receive in relation to the price of the stock. The current year dividend for Trent is Rs 3.20 and the yield is 0.04 %.
The stock opened above 52 wk high, with positive momentum. Hence, the ITM Call Option to capitalized.
