Shares of Trent Ltd. experienced a significant downturn, plummeting by 17.83% to reach ₹4,570 per share. This drop marks a nearly one-year low for the company, following a disappointing business update and a broader market decline. With the stock hitting the lower circuit limit, investor sentiment has turned bearish, fueled by critical assessments from analysts.

Market Reactions and Analyst Insights

Following the company’s fourth-quarter results, Goldman Sachs lowered its price target for Trent from ₹7,500 to ₹6,760, highlighting weaker-than-expected sales growth. Similarly, Morgan Stanley pointed out that Trent’s revenue growth for the fourth quarter did not meet projections.

• Fourth-quarter sales growth: Up by 28% year-on-year, down from 37% in the previous quarter.
• Standalone gross revenue: Recorded at ₹4,334 crore, which fell short of Morgan Stanley’s anticipated 35% growth.

Declining Sales Trends

For fiscal 2025, Trent reported a gross standalone revenue growth rate of 39%, slightly below the expected 42%. Analysts from Goldman Sachs noted that sales typically decline in the fourth quarter due to seasonal factors; however, this year’s quarter-on-quarter decline of 9.7% was sharper than usual. This signals potential weaknesses in demand or aggressive discounting strategies to manage inventory.

The slowdown in sales growth could also be linked to a declining trend in like-for-like sales, which had already begun to show signs of deceleration in the third quarter. Analysts fear that this pattern may persist, potentially affecting Trent’s future performance.

Long-Term Outlook Remains Positive

Despite these disappointing figures, experts maintain a cautiously optimistic view on Trent’s long-term potential. The company’s robust store expansion strategy and recent tax cuts may provide significant advantages moving forward.

As of 09:57 a.m., the stock has slightly recovered, trading at ₹4,578.95, down 17.69%. In comparison, the NSE Nifty 50 index declined by 3.96%. Over the past year, Trent’s shares have still recorded a 16.46% increase. The volume of shares traded today was 12 times the average over the past 30 days, indicating heightened activity and interest in the stock.

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