Trent shares fall 36% from peak; still a ‘Marquee Buy' for Macquarie with ₹7,200 target
The recent correction follows a sustained rally in April and May, during which the stock had rebounded from its earlier lows. However, investor sentiment turned cautious at the start of the current month after the company's management commentary signalled slower growth in the near term for its core fashion business, which has been the primary engine of Trent's expansion in recent quarters.
Despite the pullback, global brokerage Macquarie maintained its 'Outperform' rating on the stock, reaffirming Trent as a marquee buy idea. The brokerage has a target price of ₹ 7,200, implying an upside of 32.6 percent from the stock's last close.
Macquarie acknowledged that the first-quarter commentary was softer than expected and could weigh on near-term stock performance. However, it remains optimistic about Trent's full-year outlook, especially after management reaffirmed its FY26 revenue growth target of 25–30 percent.
'We believe the weakness in Q1 is likely due to one-off factors, including unseasonal rains and the India-Pakistan cricket match impact during the peak retail season,' Macquarie said. The brokerage added that these temporary disruptions are expected to subside, leading to a recovery in growth in the coming quarters.
Macquarie also highlighted Trent's agile supply chain and strong design capabilities as long-term advantages. It sees a large addressable market in India's fashion retail segment, supporting industry-leading growth metrics. The stock remains part of Macquarie's Asia Marquee Buy list and India Super 6s, indicating strong conviction in the business model.
At its Annual General Meeting (AGM) for 2025, Trent provided several key updates that offer insights into its growth strategy for the current fiscal year:
Q1 FY26 revenue crossed ₹ 5,000 crore, marking a 20 percent YoY growth.
5,000 crore, marking a 20 percent YoY growth. The company plans to add at least 250 new stores in FY26 across its core formats.
It reiterated its 25–30 percent revenue growth target for the full fiscal year.
Management also stated that full-year numbers are a more accurate reflection of performance than any single quarter.
These updates suggest that the company remains committed to expanding its footprint, particularly through its Westside and Zudio formats. Analysts noted that Trent has historically exceeded its guidance. For instance, in FY25, Zudio added 244 stores versus a target of 200, and Westside added 40 stores versus 30 planned.
Despite Trent's sharp correction in recent weeks, Macquarie sees valuation support and strong fundamentals backing a recovery. The company is benefiting from the tailwinds of a growing consumption economy, and the organised retail sector's expansion in India.
Over the past one year, Trent's stock is down 2.5 percent. Year-to-date in 2025, it has seen a sharp reversal in July after strong gains earlier in the year. The stock's steep drop from its peak has raised concerns, but analysts argue that the pullback offers a potentially attractive entry point for long-term investors.
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