Time period given by analyst is one year when Trent Ltd. price can reach defined target.
Trent Ltd., incorporated in the year 1952, is a Large Cap company (having a market cap of Rs 39956.79 Crore) operating in Retail sector.
Trent Ltd. key Products/Revenue Segments include Readymade Garments, Other Operating Revenue and Rent for the year ending 31-Mar-2021.
Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 1225.52 Crore, up 124.95 % from last quarter Total Income of Rs 544.79 Crore and up 96.85 % from last year same quarter Total Income of Rs 622.58 Crore. Company reported net profit after tax of Rs 69.98 Crore in latest quarter.
Investment Rationale
Trent’s Q2 performance surprised positively. Standalone revenue grew 126% YoY (2-yr CAGR for H1FY22 stood at -8%). The make-up of format-wise store openings implies that the beat was mostly led by SSSG. GM surprised positively too (52.1% vs HSIE: 46.3%), suggesting that full-price sales were higher than expected. Lower inventory provisions YoY and normalisation of revenue mix in favour of Westside are likely to have contributed to the GM recoup too (11pp YoY). EBITDAM, at 21.7%, was the highest in 10 quarters (HSIE: 14.3%). Working capital continues to normalise. FY23/24 EBITDA estimates remain unchanged. The brokerage retains SELL recommendation with an SOTP-based TP of INR 810/sh (implying 28x Dec-23 EV/EBITDA).
Promoter/FII Holdings
Promoters held 37.01 per cent stake in the company as of 30-Sep-2021, while FIIs owned 30.13 per cent, DIIs 11.16 per cent.
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