Trent Reports Strong Q1 Performance, Shares Surge

The Tata Group -backed retail company Trent on Thursday reported a consolidated net profit of Rs 519 crore in the June quarter (Q1FY27), marking an increase of 20.8% from Rs 430 crore reported in the same period last year. The headline profit number was marginally below Bloomberg consensus estimates of Rs 530 crore for the period. The street, however, cheered the performance of the retailer, with the stock surging as much as 4.56% intra-day on the BSE. Trent shares closed trade at Rs 3,110 apiece on the BSE , up 0.16% versus the previous day’s close. The company’s consolidated revenue from operations in the April-June period advanced 17.8% to Rs 5,755 crore from Rs 4,883 crore reported a year earlier, coming in below Bloomberg consensus estimates of Rs 5,878 crore for the quarter. The retail major, best-known for chains such as Westside and Zudio, reported a strong operational performance as its consolidated earnings before interest, tax, depreciation, and amortisation (Ebitda) in Q1 advanced 33.1% year-on-year to Rs 1,129 crore and its Ebitda margin improved by 220 basis points to 19.6% from 17.4% reported last year. Bloomberg consensus estimates had pegged Ebitda at Rs 1,075 for the quarter. At the end of the first quarter, Trent had 1,312 stores in 330 cities including three stores in United Arab Emirates (UAE). The total retail area was over 18 million square feet across its portfolio of brands. The company added 19 Zudio stores and one Westside store at the end of Q1 compared with 109 Zudio stores and 22 Westside stores it opened in the March quarter. Total store count at the end of Q1 stood at 301 stores for Westside, 982 stores for Zudio and 29 stores across lifestyle concepts. “Our brands continue to represent only a small share of the overall addressable market, providing significant headroom for growth across geographies and customer segments. While external market conditions may influence demand patterns from time to time, our performance is fundamentally anchored in our ability to offer relevant and aspirational products,” Noel Tata, chairman, Trent said. In its June-quarter investor presentation, Trent said its store portfolio had evolved over time. “We continue to add stores within select existing catchments across Tier I and Tier II cities, even as we accelerate presence in multiple smaller markets in the current phase of network expansion,” the company said. In the case of Zudio, the retailer said, over 80% of new stores were opened in Tier II and III cities and in peripheral new growth micro-markets. “The intent is to grow our presence in both existing as well as new micro-markets and geographies and to position ourselves favourably as more regions register stronger economic growth. The agenda is to pursue growing reach and share of revenues as we selectively increase the density of our presence across key markets with an improving customer proposition,” Trent said. The retailer also added that emerging categories, including beauty & personal care, innerwear and footwear contributed over 21% of revenue in Q1. Online revenues contributed to over 6% of Westside revenues in the June quarter, Trent said.