Trent Ltd. has recently captured the focus of brokerages due to its Q2 performance and growth strategies in fashion retail. Here’s a consolidated view of brokerage recommendations, target prices, and the key highlights that make Trent a noteworthy stock in the retail sector.
Summary of Brokerage Calls on Trent
| Brokerage House | Call | Target Price (₹) | Upside/Downside from CMP (₹6,530) |
|---|---|---|---|
| Jefferies | Hold | 5,900 | 9.66% Downside |
| Bernstein | Outperform | 8,100 | 24.06% Upside |
| Morgan Stanley | Overweight | 8,032 | 23.01% Upside |
Highlights from Each Brokerage
Jefferies: Hold with Target Price ₹5,900
Downside: 9.66%
Key Insights: Jefferies issued a Hold call on Trent, citing that the company missed elevated estimates despite robust growth. The brokerage observed store closures in key fashion formats but noted that management remains confident about growth opportunities. Jefferies advises caution due to the high current market price compared to its intrinsic valuation.
Bernstein: Outperform with Target Price ₹8,100
Upside: 24.06%
Key Insights: Bernstein issued an Outperform rating, noting Trent’s measured store expansion and surprising EBITDA margin resilience. The brokerage highlighted Trent’s focus on Same-Store Sales Growth (SSSG) and the potential of its new growth avenues, including Westside Pome, Zudio Beauty, and Zudio International. According to Bernstein, these strategies support Trent’s long-term expansion in the retail sector.
Morgan Stanley: Overweight with Target Price ₹8,032
Upside: 23.01%
Key Insights: Morgan Stanley observed a modest revenue miss in Q2, but the margins beat expectations. Trent’s fashion business showed strong resilience, with EBITDA margins at 15.9%, exceeding Morgan Stanley’s estimate of 14.5%. Trent’s Star business segment posted 27% revenue growth, supported by 14% like-for-like growth and two new store additions, underscoring its steady growth trajectory.
Brokerages generally hold a positive view on Trent, with Bernstein and Morgan Stanley issuing Outperform and Overweight ratings, respectively. While Jefferies remains cautious, citing valuation concerns, the overall consensus emphasizes Trent’s solid margin performance, strategic growth in fashion retail, and successful expansion efforts. The stock’s growth potential appears promising, driven by strong SSSG and new ventures in the Zudio brand family.
Disclaimer
This article is for informational purposes only and does not constitute financial advice. Investors are advised to conduct their own research or consult with a financial advisor before making any investment decisions. Brokerage views are based on independent analysis.
