Sharekhan's research report on Trent
Trent’s Q2FY2025 numbers were strong amid muted demand, with revenues growing by ~40% y-o-y, EBITDA margins stable y-o-y at 15.9% and PAT rising by 46% y-o-y. Despite subdued demand and seasonality, fashion concepts registered double-digit life-for-like (LFL) growth. Gross margins of Westside and Zudio remained consistent. Trent recently launched its first international Zudio store in the UAE and the Zudio Beauty concept in India. At H1FY2025-end, it has portfolio of 831 fashion stores and 74 food and grocery stores.
Outlook
Stock has corrected by 22% since its recent high and is trading at 68x/51x/42x its FY2025E/FY2026E/FY2027E EV/EBITDA, respectively. We maintain Buy with a revised SOTP-based PT of Rs. 8,162.
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