Trent shares drop 4% after Q4 earnings; results breakdown, analysis here

Business Standard

30-04-2025

Shares of Tata Group-owned Trent Ltd. tumbled nearly 4 per cent on Wednesday after it reported a 54.8 per cent profit drop in the fourth quarter (January-March) of the financial year 2024-25 (Q4FY25) compared to the same period of FY24.
The fashion and lifestyle retailer's stock fell as much as 3.64 per cent during the day to ₹5,195 per share, the biggest intraday loss since April 25 this year. The stock pared losses to trade 3.3 per cent lower at ₹5,212.5 apiece, compared to a 0.01 per cent advance in Nifty50 as of 9:32 AM.
The company's counter snapped its two-day gaining streak on Wednesday and has risen over 15 per cent from its recent low of ₹4,488, which it hit early this month. The stock has fallen 27 per cent this year, compared to a 2.9 per cent advance in the benchmark Nifty50. The lender has a total market capitalisation of ₹1.84 trillion, according to BSE data.
Trent Q4FY25 Results breakdown
Trent's consolidated net profit declined 54.8 per cent in the fourth quarter (January–March) of the financial year 2024–25 compared to the same period last year, despite including ₹576 crore in gains from reassessment of lease term estimates.
Its revenue from operations rose 27.9 per cent to ₹4,216.9 crore in Q4 compared to the same period last year, and its like-for-like growth was in mid-single digits in the quarter on a standalone basis. In FY25, like-for-like growth was in double digits on a standalone basis. Its profit before interest, tax and depreciation stood at ₹725.3 crore, down 37.7 per cent, in Q4. The company said that it operates over 1,000 large-box fashion stores.
Trent management commentary
In FY25, Trent built on the agenda of strongly growing their reach and becoming more accessible to customers, Noel N Tata, chairman at Trent, said in the release. "Given the seasonality of the business, nature of the real estate market, and our approach to inventory management, the full-year performance is more representative with respect to revenues, operating profitability, and network expansion vis-à-vis any individual quarter.'
Tata added, 'Our fashion portfolio continues to be differentiated by disciplines and choices. In FY25, Zudio revenues exceeded a billion dollars. Both Westside and Zudio now have the scale and reach, and enjoy significant consumer awareness and love. The Indian consumer has evolved rapidly in recent years, and is seeking an aspirational product proposition, attractive pricing and, importantly, ready accessibility.'
Brokerage reviews:
Nuvama on Trent
According to Nuvama, Trent's Ebit margin expanded by 100 basis points in the fourth quarter of FY25, despite mid-single-digit like-for-like (LFL) growth, which was weaker than the high-single-digit growth seen in the previous quarter and insufficient to drive operating leverage.
The slowdown in LFL growth is likely due to multiple factors, including softening demand, cannibalisation from new stores in overlapping areas, increased competition, and base effects, it said. The brokerage also flagged the declining LFL growth in the Star portfolio as a concern that must be addressed for the format to scale meaningfully.
Centrum Broking on Trent
Centrum Broking noted that LFL growth in Trent's fashion portfolio was in the mid-single digits, compared to double-digit growth in the previous year, despite aggressive store expansion. The brokerage remains optimistic on Trent's multi-pronged growth strategy, especially for Zudio, driven by strong product offerings and an efficient supply chain.
However, it flagged that lower LFL growth could weigh on sentiment and potentially slow future store additions. Centrum has retained its 'Add' rating with a target price of ₹6,245.