Trent shares fall 10% as Q1 biz update disappoints; here's why

Trent Ltd shares plummeted 10 per cent in Tuesday's trade as the 19 per cent provisional revenue growth reported by the Tata group firm for the June quarter came in lower than 22 per cent growth that analysts were expecting in their earnings projections. 

Nishchal Jain, Quant Researcher at Share.Market said while aggressive scaling pushed Trent's fashion footprint to 1,312 stores, headlined by Zudio scaling to 982 locations and Westside to 301, this rapid expansion triggered localised cannibalization, leading to a 12.2 per cent drop in revenue per square foot. 

He said the revenue miss triggered intense institutional profit-booking, causing the stock to plunge intraday. The high-volume sell-off decisively shattered the crucial Rs 3,300 support and snapped a massive 50 per cent rally from its March lows. 

"The underlying investment thesis remains firmly intact, anchored by the hyper-scalable Zudio model and deep consumer trust, framing this market dip as a temporary realignment of explosive store network growth with near-term unit economics, Jain said.

​Trent's revenue growth came in weaker than expected and is negative for the stock in short term, said SBI Securities.

Nuvama Institutional Equities in its preview note expected Trent to report 22 per cent YoY growth in its topline, driven by positive same-store sales growth. It was already expecting Ebitda margins for Trent to compress, given the higher cost of new leases and slower productivity. 

Trent shares fell 9.96 per cent to hit a low of Rs 3,010.10 on BSE, trimming its 2026  gains to 6.49 per cent. 

MOFSL also said Trent’s Q1 standalone revenue of 19 per cent YoY came in lower than its 22 per cent YoY growth estimate. 

MOFSL said Trent's growth was primarily driven by 26 per cent YoY increase in store count, with revenue per store declining 5 per cent YoY against a revenue per store decline of 4 per cent YoY in the March quarter. This indicated either a slower ramp-up of newer stores or continuation of cannibalization impact on select stores.

MOFSL said Trent's scrip had jumped 23 per cent over the past one month and 50 per cent from its March 2026 lows on expectations of a further acceleration in revenue growth. 

Citing 20 per cent year-on-year (YoY) growth that Trent reported for the March quarter, MOFSL said 19 per cent YoY provisional revenue growth in the Q1 business was weaker-than-expected and anticipated a correction on the counter.

"Conversely, for those awaiting an opening, this retracement provides a long-awaited gateway into a high-conviction retail powerhouse; nevertheless, a methodical "Staggered Buying" tactical plan is essential to weather temporary price volatility and capitalize on the stock as it carves out a durable bottom," Jain said.

For the June quarter, Trent added 26 stores, bringing the total fashion format store count to 1,312, up 26 per cent YoY. Westside added one net store for the quarter, bringing its overall store count to 301, up 21 per cent YoY). Zudio witnessed 19 net store openings in Q1 to reach 982 stores (up 28 per cent YoY).

Trent’s other fashion format store count increased by six QoQ to 29, flat YoY.

In its Q1 preview note, MOFSL had expected 22 per cent revenue growth driven by store additions and same-store sales growth recovery. It expected gross margins to remain stable YoY for the quarter, while operating margins to improve by 50 basis points, driven by operating leverage.

MOFSL had estimated Ebitda to grow 25 per cent YoY, while it expected profit after tax to rise 19 per cent YoY. The brokerage had anticipated 15 store additions in Zudio, while Westside store count could remain stable QoQ at 300, MOFSL suggested earlier.