Retailer Trent has been upgraded to an “Add” rating by analysts, following a near 50% correction in its share price from peak to trough, a move that has significantly improved the risk-reward profile of the stock.
Earlier concerns had centred on signs of slowing momentum at Westside and what was seen as peak efficiency at value-fashion chain Zudio. These factors had previously kept analysts cautious on what is otherwise regarded as a high-quality retail franchise. However, recent operational trends suggest a potential turning point.
A key driver is Zudio’s evolving store expansion strategy. More than half of its current store network has been added over the past 18 months, with most of these outlets set to be included in same-store sales growth (SSSG) calculations from FY27 onwards. In addition, a growing share of new stores is being opened in under-retailed districts in North and East India, regions that are considered more conducive to future SSSG recovery. The proportion of store additions in these regions has steadily increased, reaching 60% so far in FY26.
Despite recent softness in sales density, analysts believe this may be temporary. Many of Zudio’s North and East districts have limited competitive presence, with low store penetration and strong market share, suggesting further scope for expansion. Store additions of 170 to 180 per year are expected over the medium term.
Westside, meanwhile, could benefit from a sharp rise in customer engagement. Memberships under its loyalty programme jumped by more than 50% in FY25, a trend that may support stronger same-store sales as the customer base matures. Analysts forecast revenue growth of around 15% annually for Westside through FY28, with stable operating margins.
By contrast, the Star format remains a work in progress. While staples and fresh categories are performing well, slower growth in fast-moving consumer goods continues to weigh on overall performance.
The upgrade reflects both improving operational indicators and a substantial valuation reset, with Trent now trading at significantly lower forward earnings multiples. Analysts see this combination as justifying a more constructive stance on the stock.
