Trent, the Tata Group retailer behind Westside and Zudio, has emerged as the weakest performer in the Nifty 50 in 2025 after its share price plunged roughly 40% over the last year, even as the index climbed 10.5%. The fall marks the company’s first annual decline in 11 years and has raised fresh questions about whether the business can restore its earlier momentum in 2026.
While long-term holders have seen substantial gains — Trendlyne data shows roughly 552% returns over five years — recent weakness reflects a mix of valuation correction and operational strain. Analysts say a near triple-digit price-to-earnings multiple was difficult to justify once top-line growth moderated and early signs of demand softness appeared.
Trent stock outlook for 2026
Research heads at broking firms point to several factors behind the downturn. Ventura’s Vinit Bolinjkar highlights a valuation reset from roughly 101x to the mid-90s P/E, persistent foreign institutional investor outflows and technical indicators signalling oversold conditions. Operationally, revenue per square foot has remained resilient at over 7,000 per square foot, but like-for-like sales growth slowed to low single digits as densification and a weaker consumer environment took effect.
Angel One’s Vaqarjaved Khan notes that growth did not collapse but that its quality has deteriorated. Rapid store additions have supported top-line numbers while masking softness in existing stores. In Q2FY26 the company opened 19 Westside stores and 44 Zudio stores, including one in the UAE, while consolidating a handful of outlets. That expansion kept revenue momentum but introduced mix-led margin pressure, higher depreciation and stretched operating leverage.
Large-scale investment in new formats and more than 100 store openings a year have weighed on free cash flow despite operating cash flow rising to 71,120 crore. Analysts also point to stiffer competition from Reliance Retail and Aditya Birlawhich has compressed margins alongside input-cost headwinds.
Market sentiment is mixed. Broker research collated by Trendlyne lists nine analysts with Strong Buy calls, three with Buy, six with Hold, four with Sell and two with Strong Sell. That divergence reflects differing forecasts on whether margin recovery will materialise as new stores mature and operating leverage improves.
Looking ahead, analysts say Trentspotential upside lies in newer formats such as Star grocery and the Zudio Ramp concept, which could improve sales density and mix over time. Managementhas also reduced stake in the Zara JV, potentially creating more capital flexibility for reinvestment.
However, a sustained rerating will require signs that same-store sales growth has recovered, that margins stabilize despite Zudio scaling up, and that growth becomes more productivity-led rather than purely store-addition driven. If those indicators improve in the first half of 2026, analysts see scope for a partial rebound as expansion matures and opex leverage kicks in.
Investors should weigh the stockperspective: while the valuation reset has created an entry point for long-term buyers, the near-term path depends on execution and consumer demand. This article is for educational purposes and does not constitute investment advice. Readers should consult certified financial advisers before acting.
Key Takeaways:
- Trent stock fell about 40% in the past year, underperforming the Nifty 50 while still delivering 552% returns over five years.
- Analysts point to a valuation reset, rapid store expansion and margin pressure from competition and input costs.
- Management’s aggressive roll-out of Westside, Zudio and Star formats may boost revenue density but will test margins before benefits appear.
