Trent Shares Fall 11% After Q1 Revenue Growth Misses Market Expectations

Shares of Trent Ltd plunged nearly 11 percent in early trading on Tuesday after the Tata Group-owned retail company’s June quarter business update fell short of market expectations, triggering cautious reactions from brokerages.

The stock declined as much as 10.7 percent to ₹2,986 during morning trade after investors reacted negatively to the company’s first-quarter performance update.

Trent reported a 19 percent year-on-year increase in standalone revenue for the June quarter, but the growth was slightly below analysts’ estimates. The pace of store additions also disappointed market participants.

The company posted standalone revenue of ₹5,666 crore for the quarter ended June, compared with ₹4,781 crore in the same period last year.

Trent’s retail network expanded to 1,312 stores, including 301 Westside outlets, 982 Zudio stores and 29 stores under other lifestyle formats.

While the company continued to see growth across its major brands, brokerages described the quarterly update as slightly weaker than expected.

Analysts noted that revenue growth moderated compared with expectations and store expansion slowed during what is typically a softer quarter for network additions.

Most analysts, however, did not view the slower store rollout as a major structural concern. Some cautioned that the stock’s strong rally in recent months had increased expectations, leaving limited scope for weaker-than-expected results.

Market opinion on Trent remains mixed. Optimistic analysts continue to support the company’s long-term growth story, highlighting the expansion of Westside and Zudio, along with the possibility of improving margins as the business scales.

On the other hand, cautious investors have raised concerns over slowing store productivity, increasing competition in the value-fashion segment and potential cannibalisation among outlets.

Several brokerages continue to consider Trent among the stronger players in India’s organised apparel retail market due to its aggressive expansion strategy and Zudio’s growing presence in value fashion.

Before the quarterly update, HSBC had expected around 21 percent revenue growth, supported by continued momentum in Westside and Zudio.

Bernstein had also identified Westside’s faster expansion as a possible additional growth driver.

Trent had reported a 26 percent rise in consolidated net profit for the March quarter, supported by healthy demand and retail network expansion.

However, with its store base expanding rapidly, investors are now closely monitoring whether growth momentum can be sustained at the same pace.