Trent shares get their third-lowest price target after Kotak cut on limited GST impact

Shares of Tata Group company Trent Ltd. were trading lower on Thursday, September 11, after brokerage firm Kotak Institutional Equities maintained a ‘Reduce’ rating on the stock.

Kotak cut its target price on Trent to ₹4,900 from ₹5,300 earlier.

The brokerage wrote in its note that while the Goods and Services Tax (GST) cuts will have a positive impact, they apply to only a relatively small portion of Trent’s sales and may therefore have a limited effect on near-term revenue growth.

The report added that Trent continues to expand its store footprint in existing cities, which could keep same-store sales growth under pressure in the short term.

However, operating margins are expected to remain resilient, as the company benefits from its organisation-wide adoption of radio-frequency identification (RFID), which has improved employee cost efficiency.

Kotak also trimmed its earnings per share (EPS) estimates for FY2026-28 by 3-7%.

Trent reported its June quarter results recently, beating street estimates on all key metrics. The net profit for the quarter came in at ₹424.7 crore, up 8.5% year-on-year. Revenue grew 19% to ₹4,883 crore.

Operating performance was particularly robust, with EBITDA rising 38% year-on-year to ₹848 crore. Margins expanded to 17.3% from 15% last year, defying estimates that had projected a decline to 14.2%.

Of the 25 analysts that have coverage on Trent, 15 of them have a 'Buy' rating, while five each have a 'Hold' and a 'Sell' recommendation on the stock.

Trent shares are currently trading 0.31% lower on Thursday at rs 5,175. The stock is down 27% so far this year.

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