Earnings Outlook
Store expansion seen driving Trent Jul-Sept PAT, revenue
This story was originally published at 17:46 IST on 15 October 2024
Register to read our real-time news.Informist, Tuesday, Oct. 15, 2024
By Avishek Rakshit
KOLKATA – Tata group-owned Trent Ltd. is expected to report a net profit of INR 4.2 billion for Jul-Sept, up 44.4% from a year ago, on the back of new store openings, according to an average of estimates from seven brokerages. The company, which operates Zudio, Westside, and Zara stores, is expected to report a revenue of INR 42.9 billion during the quarter, up 48.6% from a year ago, according to the average of the estimates.
Sequentially, the company’s net profit and revenue are expected to rise 22.2% and 7.6%, respectively. The company reported a net profit of INR 2.9 billion on revenue of INR 28.9 billion a year ago and a net profit of INR 3.4 billion on revenue of INR 39.9 billion in Apr-Jun.
The company is yet to announce the date for declaring its earnings for the quarter ended September.
Among the seven brokerages, Axis Securities has projected the highest net profit for Trent at INR 5.0 billion and Nuvama Wealth Management the lowest at INR 2.9 billion. The estimates for revenue range from INR 37.0 billion by Nuvama Wealth Management and INR 45.6 billion by Centrum Broking.
Brokerages said the addition of 15 new stores in Jul-Sept will drive revenue and help Trent post industry-leading growth. Nuvama Wealth Management said Trent could report 12% like-for-like growth in the fashion portfolio. The like-for-like metric is important in the retail sector as it measures sales from the same stores in two consecutive years and shows if stores are performing well.
Centrum Broking said its ground checks indicated that consumers from the new generation favoured Zudio's merchandise for its stylish, modern designs offered at competitive mass-premium prices. Trent is capitalising on impulse purchases from young consumers by maintaining brand relevance through competitive pricing and appealing design, the brokerage said.
Trent is expected to report earnings before interest, tax, depreciation, and amortisation of INR 7.0 billion, according to the average of estimates from six brokerages. The estimates on EBITDA range from INR 5.8 billion by
Nuvama Wealth Management and INR 7.9 billion by Kotak Institutional Equities.
Axis Securities said that the demand outlook in the metros and towns ahead of the festive season and the company’s guidance on store expansion plans will be among the key monitorable.
On Tuesday, shares of Trent ended 0.8% lower at INR 8,124.25 on the National Stock Exchange.
Following are the Jul-Sept earnings estimates for Trent based on reports compiled by Informist from seven brokerage houses:
|
Broker Name |
Net Sales (in INR million) |
Net Profit (in INR million) |
EBITDA (in INR million) |
|
Antique Stock Broking Ltd |
41,915.00 |
4,145.00 |
6,653.00 |
|
Axis Securities Ltd |
44,810.00 |
5,030.00 |
7,450.00 |
|
Centrum Broking Ltd |
45,631.00 |
4,495.00 |
7,099.00 |
|
Kotak Institutional Equities |
45,116.00 |
4,603.00 |
7,878.00 |
|
Motilal Oswal Financial Services Ltd |
42,783.00 |
3,978.00 |
6,943.00 |
|
Nuvama Wealth Management Ltd |
37,033.00 |
2,940.00 |
5,820.00 |
|
Sharekhan Ltd |
43,360.00 |
4,080.00 |
-- |
|
Average |
42,949.71 |
4,181.57 |
6,973.83 |
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Saji George Titus
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