Tata group’s value fashion brand Trent on Thursday reported a lower-than-expected consolidated net profit of Rs 496.54 crore, up 34% from Rs 370.64 crore a year ago. Bloomberg consensus estimates had pegged the net profit at Rs 507 crore.
The revenue from operations also came in below Street estimates of Rs 4,760 crore, at Rs 4,656.56 crore. However, it was up 34.32% compared to Rs 3,466.62 crore a year ago.
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The company’s total expenses rose 32% to Rs 4,096.08 crore in the December quarter, as it continued to open newer stores at a “faster pace”. During the quarter, the company opened 14 Westside and 62 Zudio stores (including 1 in Dubai) across 46 cities. Trent now operates 238 Westside, 635 Zudio and 34 other stores across other lifestyle concepts.
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The gross margin profile of Westside and Zudio remains consistent with the operating Ebit margin for Q3FY25 at 13.1% against 13.3% for Q3FY24. However, the shares of Trent fell sharply on Thursday after it announced the plans to pursue store portfolio optimisation, which would involve upgrading or consolidating smaller footprint stores with newer stores in more attractive micro markets.
Trent chairman Noel N Tata said the company remains on track to strongly expand its reach and at the same time improve the quality of its store portfolio.
“Our fashion portfolio continues to be differentiated by disciplines & choices. The market opportunity associated with building brands and a pure play direct-to-customer business like ours remains immense,” he said.
“Our differentiated product offerings and an experience at aesthetically attractive stores provide a compelling value proposition to the customers. Investments in technology and supply chains have helped deliver steady results. The change in revenue participation across our concepts remains broadly in line with our strategic plans,” the company said in a statement.
The shares of the company closed over 8% in the red at Rs 5,275 apiece on BSE.
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