Trent Q4FY26 Results: 18% Upside Seen After 4% Fall

Stock drops despite Q4 beat

Trent shares slipped in Thursday’s trade on April 23 as investors assessed the company’s March 2026 quarter (Q4FY26) results against expectations. The stock fell more than 4% intraday to ₹4,252 on the NSE in a subdued broader market. Around 10:50 AM, it was quoted at ₹4,324, still below the previous close of ₹4,434.50. The Nifty50 was down 0.70% at 24,207.85 at the same time, suggesting the move was not purely index-driven. Trent’s market capitalisation was reported at ₹1.53 trillion, or about ₹1,53,000 crore. The stock remains well below its 52-week high of ₹6,261 touched on June 30, 2025, translating into a drop of about 32% from that peak.

What the Q4FY26 numbers showed

On a consolidated basis, Trent reported net profit of ₹413.1 crore in Q4FY26, up 32.57% from ₹311.6 crore a year earlier. Revenue from operations came in at ₹5,027.99 crore, a 19.23% rise over ₹4,216.94 crore. Ebitda increased 44% year-on-year to ₹653 crore, indicating stronger operating leverage versus the pace of revenue growth. The results reinforced that the company continues to grow, but the market reaction highlighted how much of the near-term narrative has shifted to growth trajectory and valuation. Some broker commentary cited concerns that revenue growth did not meet “high double-digit” expectations. The trading response also reflects that even solid reported profitability can be overshadowed by questions around sustainability of momentum.

Price action and valuation signals investors are watching

Apart from Thursday’s move, Trent’s shares have seen sharp swings around recent updates. The stock had slumped 8.5% on a recent Tuesday close to ₹4,055, eroding market value by over ₹13,500 crore in that session, according to the data cited. One view from StoxBox’s Vyom Chheda was that the Street expected a higher growth rate and that “steep valuations” were a concern, with the stock trading around 90 times earnings. Another view from Cholamandalam Securities’ Dharmesh Kant pegged the trading multiple at about 70-75 times price-to-earnings. Snapshot valuation metrics also showed TTM EPS at 46.06 and TTM PE at 96.28, alongside a sector PE of 73.87. These figures help explain why modest changes in growth expectations can drive outsized price reactions.

Motilal Oswal: Growth moderated, but long-term view intact

Motilal Oswal Financial Services (MOFSL) said Trent’s revenue growth moderated to 18% year-on-year in FY26, citing store cannibalisation, weak consumer sentiment, and expansion into newer cities with lower initial productivity. However, it added that channel checks suggest the cannibalisation impact has eased. It also noted that recent Zudio additions are largely in new cities, which may limit pressure on existing stores. MOFSL highlighted strong cost controls and healthy profitability, with margin expansion linked to a recovery in like-for-like growth. The brokerage raised FY27–28E Ebitda and PAT estimates by 5-6%, driven mainly by higher margins and partly offset by lower other income. MOFSL maintained a ‘Buy’ rating and revised its target price to ₹5,250.

SBI Securities: Expansion-led growth, fair value at ₹4,700

SBI Securities said Trent delivered an overall good set of numbers supported by aggressive store expansion. It attributed the quarter-on-quarter margin decline to expansion overheads, while pointing to healthy year-on-year margin expansion. SBI Securities also linked year-on-year PAT growth to maturing store economics. At a market price of ₹4,436, it said the stock trades at FY27E/FY28E Bloomberg consensus PEs of 73.0x and 59.8x, respectively. The brokerage estimated a medium-term fair value of ₹4,700. This view effectively frames the stock as still expensive, but potentially supported by execution and scale benefits.

Systematix: Hold call, margins seen flattening

Systematix Institutional Equities said Trent is expected to sustain revenue growth of around 18-20% over the medium term, led by continued store expansion. It expects like-for-like growth to remain in the low-to-mid single-digit range. The brokerage also warned that store densification can lead to cannibalisation, and it has factored that into its estimates. On costs and profitability, Systematix said most gains from manpower cost optimisation have already been realised. It added that a shift to a variable rental model supported FY26 margins and could offer incremental benefits in FY27. However, with key levers largely exhausted, it expects Ebitda margins of 17.4% in FY27E and 17.7% in FY28E. It maintained a ‘Hold’ rating with a revised target price of ₹4,848, valuing the business on an SOTP basis.

Earlier Q3 signals: store additions, but productivity pressure

Trent’s stock had also come under pressure after a December quarter business update. The company reported a 17% year-on-year rise in standalone revenue to ₹5,220 crore for the quarter ended December 31, compared with ₹4,466 crore in the corresponding period, excluding GST. In the same period, Trent added 65 stores across Westside and Zudio, but revenue per square foot fell 16% year-on-year on patchy urban demand. Goldman Sachs separately flagged that average revenue per square foot fell 15.7% year-on-year. Citigroup turned “cautious” in that phase, pointing to increasing competition, cannibalisation, and expansion in smaller towns. These datapoints remain relevant because Q4 commentary from brokerages again centred on cannibalisation, productivity, and the pace of growth rather than the absolute size of quarterly profits.

Key numbers and brokerage targets at a glance

Why the move matters for investors

The sharp reactions in Trent’s share price show that the market is currently sensitive to any sign of growth normalisation, especially when a stock trades at elevated multiples. Brokerages acknowledging cannibalisation and weaker consumer sentiment indicates that near-term execution will be judged not just on store additions, but on store productivity and like-for-like trends. At the same time, multiple reports still point to aggressive store expansion as the core growth engine. The divergence in ratings and targets, from ‘Buy’ at ₹5,250 to ‘Hold’ at ₹4,848, suggests consensus is split on how much margin and growth can be defended as expansion continues. For investors, the next set of updates on revenue trajectory, like-for-like growth, and margin stability will likely be key checkpoints, alongside any further brokerage estimate changes.

Closing note

Trent’s Q4FY26 results delivered strong year-on-year gains in profit and Ebitda, but the stock’s reaction underlined persistent concerns around growth pace and valuation. Brokerages continue to see upside, though with differing assumptions on productivity, margins, and cannibalisation. The market will now watch whether easing cannibalisation, as suggested by channel checks, translates into steadier like-for-like performance alongside ongoing store additions.