Trent stock surged to hit a record high at ₹4,670 on the NSE after the company reported a 13-time rise in the consolidated net profit of the March quarter at ₹704.2 crore.
After surging over 5 per cent, the stock closed at ₹4,427 on the NSE, higher by 2.62 per cent.
Observing the company’s continued stellar performance, most analysts have increased the target price for the stock.
Global brokerage Jefferies increased the target price for the stock to ₹4,150, given a ‘hold’ rating. The brokerage sees merit in following best practices from group firms such as Titan and Tata Consumer Products Ltd (TCPL).
Retaining its ‘buy’ call, Nuvama Institutional Equities has increased the target price for Trent to ₹4,926 from ₹4,304.
Domestic brokerage Motilal Oswal has reiterated the “buy” rating and has estimated a CAGR of 32 per cent/38 per cent in revenue/PAT over FY24-26, considering strong revenue growth, aggressive store additions, margin tailwinds from moderating RM costs and operating leverage.
The brokerage revised the target price of the stock at ₹4,870 saying, “We assign 50x EV/EBITDA to the standalone business (Westside and Zudio; premium over our retail coverage universe, given its superior growth), 2x EV/sales to Star Bazaar and 15x EV/EBITDA to Zara on FY26E”.
“Adjusting Star and Zara value, the stock is trading at 75x FY26E EPS of the standalone business”, it adds.
The company’s performance with 10 per cent LFL growth and robust footprint additions is an outlier, according to Motilal Oswal. “Unlike peers that passed on the sharp RM price increases last fiscal, Trent absorbed the impact, seeing strong customer reception and is now reaping the benefits as RM prices turn benign”, the brokerage added.
Meanwhile, Morgan Stanley has stated that the profit margin beat its estimates. It added that the fashion and grocery format saw consistent growth. The brokerage has maintained its equal-weight call with a target price of ₹3,675.