Trent shares get a 18% price target cut even as outperform rating retained, check details

Trent Ltd shares were buzzing in Tuesday's trade after global brokerage Bernstein revised its price target for the Tata group retail business. Bernstein lowered its target to ₹5,000, an 18% reduction, while maintaining an 'Outperform' rating on the stock. Despite this cut, the new target reflects about a 19% upside from Monday's closing value of ₹4,218.

Trent shares were trading on a flat note at Rs 4,226.80 today . Over the last year, the stock has seen a decline of nearly 38% and has dropped 40.15% on a year-to-date basis.

Bernstein said Trent's revenue growth appears to have bottomed out and outlined the key drivers for a recovery.

According to Bernstein, a combination of factors may support Trent's recovery going forward. These include expectations that like-for-like growth in split stores will turn positive, a favourable base effect, and strong expansion in the Zudio network, which has seen a three-year compound annual growth rate of 20%.

Improving consumer demand and consistent performance in the Westside format are also highlighted as positives. It expects like-for-like growth in split stores to turn positive due to a favourable base, a strong 3-year 20% CAGR expansion in the Zudio network, an improving consumer demand environment, and steady momentum in Westside.

The brokerage also projects 19% growth for Trent in FY26, with a 20% CAGR anticipated from FY26 to FY28. Bernstein expects 19% growth in FY26 and projects a 20% CAGR for FY26-FY28.

However, Bernstein also highlighted competitive risks facing Trent, particularly from rivals expanding their physical presence and seeking to emulate the value-fashion model pioneered by Zudio.

The brokerage flagged rising competition, especially new store additions and attempts to replicate Zudio's value-fashion appeal, as the main risk. Despite these challenges, Bernstein continues to see recovery drivers for Trent and has not changed its positive view on the company's operational outlook, retaining its 'Outperform' rating.