Trent shares rise ahead of Q3 results; what to expect from Zudio, Westside operator

Trent Ltd, a Tata group firm, is all set to report is December quarter results today. The fashion retailer is seen reporting up to 22 per cent year-on-year (YoY) rise in net profit for the December quarter on a 15 per cent-plus YoY growth in sales for the December quarter. Ahead of its earnings today, Trent shares were trading 1.55 per cent higher at Rs 3,882 apiece on BSE.

Antique Stock Broking expects Trent to report 21.7 per cent YoY rise in net profit at Rs 571.10 crore compared with Rs 469.30 crore in the same quarter last year. It sees sales rising 17 per cent YoY to Rs 5,305.60 crore against Rs 4,534.70 crore in the corresponding quarter last year.

Kotak Institutional Equities said it is modelling in a revenue growth of 21 per cent YoY, driven by 17 net Zudio store addition sequentially and 44 net store addition in Westside, partially offset by 11.5 per cent YoY decline in revenue per square feet. It sees adjusted profit at Rs 549.20 crore, up 15.4 per cent.

"We expect YoY area growth of 38 per cent driven by addition of larger sized stores. We expect gross margin to decline 80 bps YoY on account of higher mix of revenues from Zudio. We believe RFID-related cost savings may continue to play out in employee costs and may result in YoY Ebitda margin expansion despite weak SSSG," it said.

Kotak sees healthy Ebitda growth of 27 per cent YoY, though PBT growth is seen lower at 17 per cent due to higher depreciation charge.

Elara Securities said Trent may sustain its low-single digit like for like growth. It said slower traction in newly added stores may weigh on overall growth. Monitor the margin performance, the domestic brokerage said in its preview note. This brokerage sees Q3 profit for Trent at Rs 539.90 crore, up 8.7 per cent.