Motilal Oswal Financial Services has reiterated a BUY call on Trent Ltd., the Tata Group’s retail powerhouse, setting a target price of Rs 6,900—implying a 20% upside from current levels. The brokerage’s bullish stance is rooted in Trent’s robust execution, ambitious multi-brand expansion, and the company’s ability to sustain high growth rates despite a challenging discretionary demand environment. This report delves into the key drivers behind the recommendation, including Trent’s aggressive store rollout, strengthening of emerging categories, and prudent capital allocation. Investors should note the critical levels and growth targets highlighted for Trent as the company navigates the evolving Indian retail landscape.

Motilal Oswal’s Strategic BUY Call for Trent

Motilal Oswal has maintained a BUY recommendation on Trent, with a target price of Rs 6,900, representing a 20% potential upside from the current market price of Rs 5,735.

The research house’s conviction stems from Trent’s multi-year outperformance in revenue growth, its cluster-based expansion strategy, and the company’s ability to capture a larger share of India’s burgeoning fashion and lifestyle market. The report underscores Trent’s aspiration to grow revenues at a 25%+ CAGR over the medium term, supported by both organic and inorganic initiatives.

Long Runway for Growth: Trent’s Multi-Brand Portfolio

Trent’s share in India’s fashion and lifestyle retail sector remains in the low single digits, despite a 6.5x revenue growth over FY19–FY25.

The Indian retail industry is projected to reach USD 2.2 trillion by 2034, up from USD 1 trillion in 2025, driven by a young, urbanizing population and digital adoption.

Within this, the fashion and lifestyle segment is expected to grow at a 10–12% CAGR to Rs 18 trillion by 2028.

Trent’s management is laser-focused on increasing revenue share in key micro-markets, leveraging a portfolio approach with brands like Westside, Zudio, and forays into new categories.

The company’s cluster-based expansion, as opposed to a sole focus on same-store sales growth (SSSG), is designed to deepen market penetration and drive repeat purchases.

Star Format: Sensible Growth Amidst Scale Challenges

Trent’s Star grocery format posted approximately 25% revenue growth in FY25, propelled by a net addition of 12 stores and robust like-for-like sales.

The Star business currently operates 78 stores across 10 cities, with management remaining bullish on the segment’s long-term potential despite operational challenges.

The focus is on improving store economics and increasing the share of non-third-party (private label) brands from 73% to a targeted 80–85%, enhancing differentiation and margins.

Emerging Categories: Beauty, Innerwear, and Footwear Take Center Stage

Emerging categories now account for nearly 20% of Trent’s revenues, with exceptional volume growth in beauty (up 65% YoY), innerwear (47% YoY), and footwear (42% YoY).

The company is aggressively scaling Zudio Beauty and has launched lab-grown diamonds under the “Pome” brand, signaling a push into higher-margin, aspirational segments.

This diversification is expected to drive incremental growth and fortify Trent’s competitive moat.

Financial Performance and Valuations: Robust Metrics, Premium Multiples

Trent’s FY25–FY27E standalone revenue, EBITDA, and PAT are projected to grow at a 25–26% CAGR, underpinned by continued store additions and category expansion.

Below is a summary table of key financial and valuation metrics:

The stock currently trades at 77x FY27E PE for the standalone business, a premium justified by Trent’s superior growth profile and execution track record.

Motilal Oswal’s sum-of-the-parts (SoTP) valuation assigns 55x Mar’27E EV/EBITDA to Westside and Zudio, 2.5x FY27E EV/sales to Star JV, and 7x EV/EBITDA to Zara JV, arriving at the Rs 6,900 target.

Key Levels and Investor Targets

The current market price (CMP) of Trent stands at Rs 5,735, with a target price of Rs 6,900 (+20% upside), as per Motilal Oswal’s analysis.

Investors should monitor the following levels:

Support: Rs 5,000–5,200 (recent consolidation zone)

Resistance/Target: Rs 6,900 (12-month target)

The company’s growth trajectory is contingent on sustained store additions, recovery in SSSG across formats, and continued scale-up in emerging categories.

Risks and Monitorables

While the long-term outlook remains robust, near-term risks include muted discretionary demand, execution challenges in scaling Star, and margin pressures from aggressive expansion.

Recovery in SSSG and profitability in the Star format are key monitorables for the next few quarters.

Any slowdown in store rollout or adverse macroeconomic developments could impact the growth thesis.

Investor's Briefing: Trent Poised for Multi-Year Outperformance

Motilal Oswal’s reiteration of the BUY call on Trent is anchored in the company’s proven execution, aggressive yet disciplined expansion, and its ability to capture a larger share of India’s fast-evolving retail sector. With a clear roadmap to grow at 25%+ annually, a focus on high-growth categories, and a premium valuation underpinned by strong fundamentals, Trent remains a compelling bet for long-term investors seeking exposure to India’s consumption story. The 12-month target of Rs 6,900 offers a meaningful upside, with the company well-positioned to deliver on its ambitious growth agenda.