Tuesday, Jan 25, 2022
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Trent Ltd Shares Jump Over 9% After Q2 Earnings. Should You Invest?

The company had posted a net loss of Rs 78.56 crore in the July-September quarter a year ago, Trent said in a BSE filing on Tuesday.

Trent Ltd Shares Jump Over 9% After Q2 Earnings. Should You Invest?
Trent Ltd Shares Jump Over 9% After Q2 Earnings. Should You Invest? -

Shares of Tata group retail firm Trent Ltd on Wednesday jumped over 9 per cent after the company reported a consolidated net profit of Rs 79.99 crore for the second quarter ended September 2021.

The stock zoomed 9.25 per cent to Rs 1,133.25 on BSE. On NSE, it jumped 9.14 per cent to Rs 1,132.30.

The company had posted a net loss of Rs 78.56 crore in the July-September quarter a year ago, Trent said in a BSE filing on Tuesday.

Its revenue from operations during July-September 2021 saw over a twofold jump to Rs 1,178.08 crore, compared with Rs 585.37 crore in the year-ago period.

The company's total expenses during the quarter stood at Rs 1,116.56 crore, a jump of 57.66 per cent as against Rs 708.20 crore a year ago.

Here is what brokerages houses are saying, as per BloombergQuint.

Jefferies

The brokerage house maintains a 'hold' rating, raises target price to Rs 1,000 from Rs 870. Trent reported a strong pick-up in revenues after a dismal performance in base quarters (year-on-year/quarter-on-quarter). The highest-ever revenues as well as Ebitda and a significant beat in Q2 signal that business is on a strong footing. Better disclosure would have helped to build estimates more holistically.

Motilal Oswal

It maintains a 'neutral' rating, raises the target price to Rs 1,030, implying a potential downside of 1 per cent. Trent's superior liquidity profile, at a time when many small/unorganised retailers are under stress, and aggressive store additions should allow it to grow at a healthy pace as the market recovers.

Dolat Capital

The investment firm has upgraded it to 'buy' from 'accumulate' at a target price of Rs 1,212, implying a potential upside of 17 per cent. Trent’s Q2 FY22 performance was significantly ahead of estimates led by new stores, faster stabilisation, strong pent-up demand, and cost mitigation measures.

ICICI Securities

The brokerage house maintains a ‘buy’ rating, raises the target price to Rs 1,230 from Rs 1,160, implying a potential upside of 18.6 per cent. Believes earnings of apparel brands and retail companies may surprise positively led by faster-than-expected demand recovery.

(With PTI Inputs)

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