Star Bazaar’s expansion will be Neville Tata’s big test

Focus is sharpening on Neville Tata, son of Tata Trusts chairman Noel Tata, as Star Bazaar prepares to shift gears and accelerate expansion, marking a crucial phase for the Tata-Tesco joint venture that has struggled to match the scale and pace of larger rivals like DMart and Reliance Retail. Six months into a more active engagement with the business, the 32-year-old executive is expected to anchor a sharper revival strategy.

The signal came from Noel Tata, who is also the chairman of Trent Ltd , which houses Star Bazaar. After the third-quarter results, he admitted that the grocery chain had not expanded as quickly as anticipated. "We recognise that the expansion program for Star stores has been slower vis-à-vis our expectations and we are looking to accelerate this agenda in the coming periods." According to sources, the renewed expansion blueprint will be based on Neville Tata’s feedback, with the revival plan taking clearer shape under his leadership.

Neville joined Trent in 2016, initially overseeing packaged food and beverages business before moving to spearhead expansion of Zudio. The value fashion format has grown at a blistering pace, reflecting the disciplined execution that has become synonymous with Trent’s retail strategy. He had served as non-executive director on the Trent Hypermarket board, gaining direct exposure to the grocery vertical he is now expected to help scale up. He also serves on the boards of Sir Dorabji Tata trust and a few allied trusts of Tata.

Star Bazaar, a 50:50 joint venture between the Tata group and British retailer Tesco, operates 79 stores across 11 cities with a retail footprint of 1.36 million square feet. Its mix spans staples, FMCG and fresh categories, while general merchandise and apparel contribute 33% of sales. The format has increasingly leaned on its own brands — Fabsta, Klia, Skye and Star in FMCG, Smartle in general merchandise, and Zudio in apparel — to strengthen margins and differentiation.

Trent reported revenue of ₹5,345 crore in the third quarter, up 15% year-on-year, while consolidated net profit rose 7% to ₹531 crore.

Now the spotlight shifted to Star as it's expansion is necessary for Trent's next level of growth. According to Jefferies, revenue at Star Bazaar declined 5% in the third quarter even as the share of own brands increased sequentially to 74%. “Added 2 new stores in 3Q, taking the total store count to 79,” the brokerage noted, underscoring that expansion had been measured rather than aggressive.

Morgan Stanley highlighted management’s candid acknowledgment that store expansion trailed initial expectations, adding that the company aims to accelerate store additions in the coming periods. The commentary suggests that the next leg of growth will demand faster execution without compromising store economics.

For Noel Tata, the opportunity remains intact in the supermarket business despite the competitive intensity. "The opportunity in the food space for the Star proposition is exciting at the same time it is intensely competitive and we are calibrating our store portfolio to be more future-ready. We remain convinced that this business is well poised to deliver growing consumer value in the years ahead,” he said, reiterating that the chain would continue to apply “Trent’s playbook” of calibrated expansion. 

That playbook rests heavily on private-label strength. In Star’s case, the advantage is that the in-house brands now contribute over 74% of revenues — a notable achievement in grocery retail where margins are typically thin.

Kotak Research pointed out that nearly 33% of Star’s sales came from general merchandise and apparel, with Smartle forming around 85% of general merchandise sales. Despite this high share of private labels in relatively better-margin categories, Trent’s share of profits in the joint venture declined to ₹11.9 crore in the third quarter from ₹26.2 crore a year earlier, the Kotak analysts noted.

Kotak also said that Star’s revenue fell 5.4% in the quarter and cautioned that formats such as Star, Zudio Beauty and Burnt Toast are unlikely to move the needle meaningfully in the near term, even as Trent maintains a long-term annual revenue growth aspiration of 25%.

As Trent recalibrates its grocery portfolio to be “more future-ready,” Neville Tata’s challenge will be to translate their strong private-label stack into consistent store-level profitability while accelerating the rollout. The next few quarters will determine whether the supermarket chain can convert promise into performance under its new driving force.