Trent shares settle 11% on lower-than-expected growth in Q1; Nuvama downgrades to 'hold'

Trent shares have traded flat over the past year, rising around two percent.

Zudio and Westside operator Trent Ltd shares sank over twelve percent in tradem on Friday, July 4, after posting its business update for the quarter ended June.

For the first quarter of the current financial year, Trent posted a revenue of Rs 5,061 crore, around 20 percent higher on-year from Rs 4,228 crore reported in the same quarter last year.

As of 30th June 2025, the value retailer's store portfolio included 248 Westside, 766 Zudio (including 2 in UAE) and 29 stores across other lifestyle concepts. It opened one Westside store and 11 Zudio stores, but consolidated one Westside and 10 Zudio stores during the quarter.

In a note, Nuvama Institutional Equities said, "Trent disappointed on near-term growth expectations in its core fashion business, which is expected to deliver ~20 percent growth in Q1FY26, sharply down from its five-year CAGR of 35 percent (FY20–25)."

The firm's management reaffirmed their aspiration of 25 percent-plus growth for the coming few years, but the current run rate falls short of it. "This forces us to re-evaluate the growth targets for the company and align the same with the current run rate. Underwhelming near-term growth prompts the downgrade to ‘hold’ as the current valuation is too demanding."

As a result of the slowdown in growth, Nuvama downgraded the stock to 'hold', with a revised target price of Rs 5,884, down from Rs 6,627 earlier.

On the flip side, Morgan Stanley has an 'overweight' rating on Trent with a target of Rs 6,359, citing its goal to grow revenue 10x from FY23 levels. It expects a 25–30 percent CAGR over the next five years. The company plans to add 250 stores annually and sees room for multiple players despite rising competition.

At close, shares of the firm were quoting Rs 5,487, down 11.4 percent.

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