Citi trimmed its target price on Trent to Rs 7,800 from Rs 9,350, while retaining its ‘Buy’ rating, citing strong operational performance despite short-term demand challenges.
In Q3FY25, Trent added 12 net new Westside stores and 58 Zudio stores, compared to a net decline of six Westside stores and 32 Zudio store additions in the first half of FY25, signaling a sharp acceleration in expansion. However, like-for-like (LFL) growth slowed to high-single digits, down from double-digit growth seen in the previous two quarters.
Citi attributed the LFL moderation to softening discretionary consumption trends coupled with a high base effect. Despite this, the brokerage remains optimistic about Trent’s long-term growth trajectory, noting that the stock trades at a premium valuation (42x FY27E EV/EBITDA pre-Ind AS) relative to Titan and DMart (36x), but offers 2x revenue CAGR growth over FY24-27.
