Trent Ltd. News and Updates

Name: Latest research reports of Trent Ltd. authored by ICICI Securities Limited and published by - Trendlyne research reports.
Item: Trent Ltd.
Rating: 5
Author: ICICI Securities Limited

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Trent Ltd.

25 May 2020

5506.50

-1.49%

Trent Ltd

Buy: Trent Ltd.

Target

ICICI Securities Limited

The Covid-19 pandemic had an unprecedented impact on retail industry, forcing temporary closure of physical stores from mid-March onwards in India. The same materially impacted Trent's performance in Q4FY20. In the apparel space, Trent has been a consistent outperformer with robust revenue growth (30%+ growth in previous three quarters). However, the revenue trajectory got de-railed significantly in Q4FY20. Standalone revenues (including Westside, Zudio formats) grew 8.1% YoY to | 722.8 crore in Q4FY20. The management highlighted that for January-February,...

Trent Ltd. is trading below its 150 day SMA of 5897.7

Trent Ltd.

09 Feb 2020

5506.50

-1.49%

Trent (3QFY20): Clockwork-like growth continues. Maintain NEUTRAL

Neutral: Trent Ltd.

Recommendation Target

HDFC Securities

While execution remains top-notch, Trent seems priced to perfection with little on the table for investors at 33x FY22 EV/EBITDA. That said, we revise EBITDA estimates upwards by 4-5% for FY21/22 primarily to factor in lower cost of retailing. This coupled with our DCF roll-over for standalone biz and Zara to FY22 bumps up our SOTP-based TP to Rs. 580/sh (earlier Rs. 490). We bake in 28/30/41% revenue/EBITDA/PAT CAGR and a 440bp improvement in RoIC (ex-investments in JVs/subsidiaries over FY19-22E. Maintain NEUTRAL. Westsides clockwork-like growth continues. Trents flagship format grew 22% YoY in 9MFY20. SSSG came in at 12% - healthiest within our retail universe. We estimate Zudio to have more than doubled top-line over 9MFY20, however, we suspect productivity may have dipped. Gross margin continues to dip as 1. Zudios skew increases in the revenue mix. Share in JV/associate losses have increased over 9MFY20. While the Westside format remains a winner in terms of unit store economics; the same for Zudio is yet to be tested in catchments without a corresponding Westside store as currently the former piggybacks on the supply chain of Westside.

Trent Ltd. is trading above its 100 day SMA of 5395.2

Trent Ltd.

07 Feb 2020

5506.50

-1.49%

Trent Ltd

Buy: Trent Ltd.

Target

ICICI Securities Limited

Westside continues to be one of the most successful, established franchises, deriving 97% of share of revenues from private label brands. Over the last six years, Westside has sustained its same stores sales growth at 7%+, outperforming peers in the industry. Exceptional ramp up in store addition in non-metro cites, mainly through Zudio format (value fashion business) is one of the major growth drivers in coming years. Robust performance in a challenging scenario instils confidence in the business model, which would enable the company to command premium valuation multiple on a...

Number of FII/FPI investors decreased from 1154 to 1097 in Mar 2025 qtr

Trent Ltd.

07 Feb 2020

5506.50

-1.49%

Q3FY20 Result Review : Trent

Hold: Trent Ltd.

Target

IDBI Capital

Trent has reported above expected result during 3QFY20. SSSG at 12% for 9MFY20 (c. 10.5% in 3QFY20) compared to 5% SSSG in Pantaloons for 3QFY20 and 2% SSSG in TCNS is extremely positive. Decline in gross margin is led by rise in the revenue share of the value fashion format Zudio. PBT on like to like basis rose significantly due to higher other income. Trent continues to out-perform competition over past several quarters. We have revised our SSSG assumptions and EPS estimates upward based on 9-M actual performance. We expect Trent to continue outperform other apparel retailers in India led by disruptive pricing and superior business model. Based on recent run-up in the stock...

Trent Ltd. has an average target of 6602.25 from 4 brokers.

Trent Ltd.

06 Feb 2020

5506.50

-1.49%

Fabulous outperformance defying macro trends

Buy: Trent Ltd.

Target

Motilal Oswal

Maintain Trents revenues were up 33% YoY to INR8.7b (in-line), led by strong performance of Westside stores that witnessed an impressive 22% YoY revenue growth and 10% SSSG, considering other retailers are facing the Post Ind-AS116, PAT was up 38% YoY to INR557m, while pre Ind-AS116 PAT was up 60% YoY to INR645m (7% beat). Thus, 3QFY20 SSSG stands at ~10%, witnessing strong traction in a weak Zudios revenues are estimated at 2.3x YoY to ~INR1.14b, now contributing 13% of the total standalone revenues (up from 5% in 3QFY19), led by fast Our SOTP-based TP of INR700 values Westside and Zara at 30x EV/EBITDA and Star at 2x EV/sales on FY22E.

Number of FII/FPI investors decreased from 1154 to 1097 in Mar 2025 qtr

Trent Ltd.

26 Nov 2019

5506.50

-1.49%

Trent stock in vogue; managing expansion is key to sustaining valuations

livemint

Analysts expect Zudio to emerge as a big growth driver for Trent, although its current contribution to revenues is comparatively small.At the end of FY19, Trent had 150 Westside stores and 40 Zudio stores

Trent Ltd. is trading below its 150 day SMA of 5897.7

Broker's call: Trent (Buy)

Business Line | 25 Nov 2019

Trent Ltd.

22 Nov 2019

5506.50

-1.49%

Zudio - Bazooka in the closet!

Buy: Trent Ltd.

Target

Motilal Oswal

22 November 2019 The Zudio store and products have a trendy look and feel, offer only casual wear (no formals) and is targeted at young value-seeking consumers. The lower pricing has also been possible due to (a) passing-on of low gross margin benefits (~30% v/s Westsides 55%), and (b) no marketing costs (in line with Westside). Given the low gross margins, Zudios success lies in its strong turnover revenue/sqft of ~12-15k/sqft (v/s industry average of INR8-10k/sqft). Zudios high fashion appeal and sharp pricing has led to an encouraging store operating metrics. Therefore, a franchisees capex is INR15-20m for a store size of 6k sqft; in turn, a franchisee receives a fixed revenue share, while the company operates the store and retains the profitability. Typically, franchisees get ~16% revenue share and 12-15% IRR, while the company garners strong ROCE on merely one-month inventory capital.

Number of FII/FPI investors decreased from 1154 to 1097 in Mar 2025 qtr

Trent Ltd.

08 Nov 2019

5506.50

-1.49%

Trent: Q2FY20 Result Review

Hold: Trent Ltd.

IDBI Capital

Overall result has been in line with our estimates. Westside continues to outperform its competitors based on strong same store sales growth performance during a period when consumption slowdown is at its peak. Decline in gross margin has been due to higher discount during end of season sale and increase in revenue share from Zudio. This is not too concerning as Trent, unlike branded retailers, is able to follow strict discounting policy; 2 months a year. Gross margin dilution coming from Zudio should not have significant spill-over EBITDA margin dilution impact. This is because, in value retailing its always high inventory turn (and not gross margin) which helps to build on...

Number of FII/FPI investors decreased from 1154 to 1097 in Mar 2025 qtr

Trent Ltd.

02 Aug 2019

5506.50

-1.49%

Trent Ltd

Buy: Trent Ltd.

ICICI Securities Limited

We recently attended Trent's annual general meeting (AGM). The key takeaways are; 1) robust store addition plans in FY20 (100+ stores between Westside and Zudio), 2) outlaid capex of ~| 350-400 crore (~2x FY19), 3) opened its first exclusive store of its own ethnic brand, Utsa', 4) plans to raise additional capital worth | 600 crore in the next three to six months, 5) focus on enhancing share of private label brands for Star format with adoption of new pricing strategy to become more competitive, 6) adjusting for Ind-AS 116, EBITDA margins for Q1FY20 expanded 60 bps YoY to 12.6%...

Trent Ltd. is trading below its 150 day SMA of 5897.7

Trent Ltd.

01 Aug 2019

5506.50

-1.49%

Westside, Zudio progressing well; expect acceleration in store adds

Buy: Trent Ltd.

Target

Motilal Oswal

Revenue growth healthy; PAT supported by other income: Standalone revenue increased strongly by 30% YoY, led by healthy 21% growth in Westside sales. EBITDA was up 130% at INR1.6b on account of Ind-AS 116 reclassification we, however, believe that this number makes limited sense in the absence of any company-provided reconciliation. Reported PBT was up 50% YoY at INR865m (INR85m/9% impact due to Ind-AS 116). On a preInd-AS 116 basis, PBT would have been INR950m (+62% YoY; 32% beat). PAT (post Ind-AS 116) was up 51% YoY at INR579m (23% beat), mainly led by significantly higher other income (+6x YoY to INR359m)....

Trent Ltd. has an average target of 6602.25 from 4 brokers.

Is Trent Ltd. worth buying?

430 Votes:

Buy 70.0%

Sell 18.37%

Hold 11.63%

RESEARCH REPORTS

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