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Trent reported good operating performance in Q1FY27

ICICIdirect Research 07 Aug 2026 DISCLAIMER

News: Trent reported good operating performance in Q1FY27. Standalone revenues reported 18.5% YoY growth to Rs.5666.3cr. Revenue growth continued to be aided largely through accelerated store additions done over the past 3-4 quarters. LFL growth stood in low single digits. Store additions in Q1FY27 were muted for Westside which witnessed only 1 net store addition (Westside store count stood at 301) and Zudio adding 19 stores during the quarter (Zudio store count stood at 982). Gross profits improved by 149bps YoY to 46.6% in Q1FY27 likely to be supported by sourcing strategies which helped the company mitigate input cost inflation and supply chain disruptions due to geopolitical crisis. Flow through of gross margins coupled with lower rental cost and staff cost/sqft aided 208bps YoY expansion in EBITDA margins to 19.6% in Q1FY27. EBITDA grew by 33% YoY to Rs.1110.6cr while PAT grew by 26% YoY to Rs.532cr in Q1FY27.

View: Trent reported positive surprise on the margin front delivering 19.6% EBITDA margin during the quarter. Though the company was able to manage margins largely through sourcing gains during Q1FY27, we believe that input cost inflation due to West Asia crisis coupled with supply chain disruption crisis will lead to margin pressure in Q2FY27. Further, the management highlighted that consumer spending has remained cautious and watchful on the backdrop of the geopolitical instability. Hence, we believe that LFL growth will remain in low single digits in Q2FY27 with improvement expected to improve in H2FY27 on the backdrop of the festive season. The company has maintained its store addition guidance of 50 Westside, 200–250 Zudio and 25-40 Star Bazaar stores annually.

Impact: Neutral

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