This Tata Group stock has beat Sensex for a decade, surged 1,154% in 4 yrs: Trent shares | News on Markets
 "Zudio store")
File photo of Zudio store
The rally in the stock came after global brokerage firm Citi initiated coverage on the stock with a ‘Buy’ rating and a target price of Rs 9,250, on robust growth outlook.
Meanwhile, index provider NSE last month announced that fashion retailer Trent and state-owned Bharat Electronics (BEL) will replace Divi’s Laboratories and LTI Mindtree in the frontline Nifty 50 index. The changes, part of the semi-annual review, will become effective from September 30, NSE informed.
Trent has outperformed the market in the past 10 consecutive years.
Since the stock split from Rs 10 to Re 1 on September 12, 2016, the market price of Trent has skyrocketed 3,285 per cent from Rs 234.53. In the past four years, it has zoomed 1,154 per cent from Rs 633 on the BSE.
Trent’s transformation from a single-format (Westside) to a multi-format (Westside, Zudio, Star, Samoh, Utsa, Misbu, etc.) and multi-category (fashion and lifestyle, grocery, beauty personal care and fashion accessories) player has led to a higher revenue compound annual growth rate (CAGR), at 36 per cent between FY19 and FY24, compared to India’s leading consumer discretionary and retail peers, Citi said in its coverage report.
Leveraging on its supply chain, as well as learnings from Westside and Zudio, Trent is turning around Star and can meaningfully scale up other pilot projects, such as Misbu, Samoh and MAS joint venture. “In addition to ranking it a top pick in our India consumer discretionary and retail coverage, we include Trent in our Pan-Asia high-conviction Focus List,” analysts at Citi stated in their report.
Trent now operates 228 Westside stores and 559 Zudio stores across 178 cities.
The company achieved robust revenue growth in Q1FY25 as the top-line increased by 57 per cent Y-o-Y to Rs 3,992 crore. This growth was driven by increased footfalls and a strong performance across brands, concepts, categories and channels, despite subdued market sentiments and heightened competitive intensity.
Additionally, the improvement in the earnings profile across all formats, the reduction in losses at Star Bazaar, and the enhanced traction at the Inditex JV are positive indicators for the company.
In recent years, Trent has adopted a small-format store model for Star Food. This approach, coupled with sharp pricing and a focus on fresh produce and private labels, has yielded positive results, the brokerage firm had said in Q1FY25 result update.
Meanwhile, Trent in its FY24 annual report, said the Indian retail industry is continuing its turnaround momentum with every segment of retail recording strong growth rates. It is projected to expand to $4.5 trillion by the end of the decade, driven by socio-demographic and economic factors such as urbanisation, income growth, rise in nuclear families and a shift from the unorganised to the organised segment.
In recent years, private brands have increasingly emerged as the rising stars in the retail and e-commerce segment, the company said.
|
Year |
Trent (Rs) |
% chg |
Sensex |
% chg |
|
2014 |
148.78 |
|
27,499.42 |
|
|
2015 |
168.48 |
13.2 |
26,117.54 |
-5.0 |
|
2016 |
201.05 |
19.3 |
26,626.46 |
1.9 |
|
2017 |
336.95 |
67.6 |
34,056.83 |
27.9 |
|
2018 |
361.5 |
7.3 |
36,068.33 |
5.9 |
|
2019 |
527.15 |
45.8 |
41,253.74 |
14.4 |
|
2020 |
687.9 |
30.5 |
47,751.33 |
15.8 |
|
2021 |
1,064.95 |
54.8 |
58,253.82 |
22.0 |
|
2022 |
1,350.65 |
26.8 |
60,840.74 |
4.4 |
|
2023 |
3,056.15 |
126.3 |
72,240.26 |
18.7 |
|
2024* |
7,939.90 |
159.8 |
85,169.87 |
17.9 |
|
|
|
|
|
|
|
Till September 26, 2024 |
|
|
||
First Published: Sep 26 2024 | 11:21 AM IST
