Shares of Trent Ltd continue to stay in focus following a flurry of brokerage commentary after the Q1FY26 results. At a CMP of ₹5,335, opinions remain divided, with Avendus downgrading, Motilal Oswal (MOSL) and Antique maintaining ‘Buy’, and Citi and Bernstein issuing cautionary notes despite Buy/Outperform ratings.
Avendus on Trent: Downgrades to ‘Reduce’ on stretched valuation
Avendus has taken the most bearish stance among its peers, downgrading Trent to ‘Reduce’ with a target price of ₹5,000 (cut from ₹5,650). The brokerage flagged that FY26 may see a consolidation phase with revenue and growth slowing, even though demand remains broadly healthy. It cited muted macro conditions, potentially capping the company’s market cap around ₹2 lakh crore.
Avendus trimmed revenue estimates by 4% (FY26) and 6% (FY27) and expects EBITDA margins to hold at 17–18%, calling the 65x PE valuation ‘stretched’ and the risk-reward now unattractive.
Motilal Oswal on Trent: Maintains ‘Buy’, trims TP on PAT concerns
MOSL retained a Buy rating but cut the target price to ₹6,400 from ₹6,600. While margin expansion surprised positively, PAT estimates were lowered by 1–5% due to higher depreciation. The brokerage maintained its EBITDA estimates but is building in 20%/18%/16% CAGR for revenue, EBITDA, and PAT respectively over FY25–28.
MOSL added that revenue acceleration remains the key trigger, even as growth moderation continues.
Antique on Trent: Retains ‘Buy’, hikes TP on earnings beat
In contrast, Antique stayed bullish, reiterating a Buy call with a revised target price of ₹7,301, up from ₹6,045. The firm said profitability beat estimates this quarter, despite low-single-digit like-for-like (LFL) growth in fashion concepts.
Antique said Trent remains an outperformer in a weak demand environment, aided by cost rationalization, and raised its FY26/27 EBITDA forecast by 3%.
Bernstein on Trent: Flags revenue/SQFT weakness despite O-P rating
Bernstein rated the stock Outperform (O-P) with a target of ₹6,500, but flagged a significant disappointment in revenue growth. The company added 27% stores YoY, translating to a 38% increase in retail space, but revenue grew just 20% in Q1FY26, sharply lower than 57% in Q1FY25.
This implies a drop in revenue/SQFT, and low ramp-up at new stores, with LFL growth also at low-single digits, according to the brokerage.
Citi on Trent: Maintains ‘Buy’, trims TP on slower LFL
Citi maintained its ‘Buy’ rating, but revised the target price to ₹7,150. While revenue growth slowed to 20% YoY, it remains above most discretionary peers, according to the note. LFL growth moderated and store additions remained muted.
However, Citi highlighted a positive profitability surprise, driven by lower employee costs and reversal of past provisions. Management’s focus on tier-2/3 markets and overall revenue over LFL growth was also underlined.
Disclaimer: This article is based on brokerage reports and publicly available inputs. It is intended for informational purposes only and does not constitute investment advice.
