Trent Q4 Results Review- Delivering Consistent Industry Outperformance With Enhanced RoE Profile: ICICI Direct

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..ICICI Direct Report.Despite a challenging demand environment, Trent Ltd. continues to remain insulated with industry best growth rates mainly driven by Zudio format.Revenue grew 75% YoY to Rs 2077.1 crore (our estimate: Rs 1920.1 crore) on a favorable base. On a three-year compound annual growth rate basis, revenue growth was at an impressive 42%, which is the highest among other lifestyle retailers.Owing to increase in share of Zudio format, Trent recorded one of its lowest gross margins of 40.8% (down 830 bps YoY, Zudio yields lower gross margins but has superior asset turn).However, on account of positive operating leverage, Ebitda margin contraction was restricted to 264 bps YoY to 10.2% (our estimate: 12.1%). Despite lower than anticipated margins, absolute Ebitda was at Rs 212 crore (our: Rs 232 crore) with three-year CAGR of 32%.Key triggers for future price performance:We pencil in 215 store additions between Westside and Zudio for FY24-25E.Liquidity position remains strong with cash and investments worth Rs 600 plus crore that will enable it to tide over the current situation better than peers.Zudio continues to be the growth engine for Trent. We expect revenues to grow at a CAGR of 27% in FY23-25E.In the long run, Trent aims to grow its revenue at CAGR of 25% plus..Click on the attachment to read the full report:.Trent Q4 Results Review - Another Quarter Of Blockbuster Growth; Margins Remain Under Pressure: Systematix.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Trent Q4 Results Review- Delivering Consistent Industry Outperformance With Enhanced RoE Profile: ICICI Direct

Despite a challenging demand environment, Trent continues to remain insulated with industry best growth rates driven by Zudio.

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