Shares of Mumbai-based retail company Trent have delivered multibagger returns to its long term investors by rallying over 435% in the last five years. The Tata group stock has zoomed 1,266% over the past ten years, whereas it has gained 70% during the last one year. In comparison, the S&P BSE Sensex gained 124% in the last five years and 277% over the ten-year period.
The retail arm of Tata group saw its shares surging from ₹214 on January 12, 2017, to ₹1,168 per share in intraday trade today. If a person had invested ₹1 lakh in this retail stock in January 2017, it would be worth Rs ₹5.45 lakh at present.
Trent has outperformed retail industry peers such as Aditya Birla Fashion and Retail (120%), Arvind Fashions (-35%), Shoppers Stop (23%), Future Retail (-68%), and Spencer's Retail (-48%), in terms of its returns over the last five years.
With a market capitalisation of ₹41,010 crore, the retail venture of the Tata group operates through various store concepts across India. With a presence of about 400 stores as on March 31, 2021, Trent operates Westside, one of the many growing retail chains in India, and Landmark, a bookstore chain with brick and mortar stores in various locations of India. It also runs different store concepts such as fashion retailing through owned formats of Zudio, Utsa, and Zara, and grocery retailing though Star Stores, via its 50% joint venture Trent Hypermarket.
During the quarter ending September, Trent had posted a consolidated net profit of ₹80 crore, as compared to net loss of ₹78.56 crore in the July-September quarter a year ago. Its revenue from operations jumped over two-fold to ₹1,178.08 crore, compared with ₹585.37 crore in the year-ago period. The sharp rebound in top and bottom line growth indicated that the business returned to normalcy and the retail segment gradually recovered from pandemic impact with an increase in footfalls.
For the year ended March 31, 2021, the retail arm of Tata group reported a consolidated net loss of ₹181 crore compared with net profit of ₹105.98 crore reported in the year ended March 2020 (FY20). Net sales dropped 25.6% to ₹2,592.96 crore in FY21 over FY20.
On Thursday, Trent share price opened higher and gained as much as 2.3% to hit an intraday high of ₹1,172.80 on the BSE. The stock has been gaining for the last three days and has risen 7.38% during the period. Trent shares traded higher than 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, according to stock research platform Markets Mojo.
On the technical front, Trent has turned mildly bullish from bullish on January 6 at ₹1,081.60. The stock is currently trading at a discount compared to its average historical valuations, as per the research platform.