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Bengaluru: Trent Ltd kicked on Wednesday posted a double-digit revenue growth for the June quarter, led by continued expansion of its fashion businesses Zudio and Westside.
India’s second-largest retailer by market capitalization recorded a revenue of ₹4,883 crore for the first quarter of FY26, up nearly 19% year-on-year (y-o-y). The company saw a 13% increase in net profit to ₹565 crore.
The company had recently revised its growth outlook downward, from a five-year compounded annual growth rate (CAGR) of 35% to a more tempered guidance.
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Of the ₹4,883 crore revenue generated during the quarter, about 82% came from Trent’s fashion businesses Zudio and Westside, while the remaining 18% came from its food and grocery unit, Star. The company has not disclosed the standalone revenue numbers for Zudio and Westside.
Store footprint
The retailer saw its overall store footprint shrink during the reporting quarter. As of 30 June, it operated 1,043 stores, down 48 from a quarte ago, primarily due to consolidation across formats. Zudio was the biggest growth engine. The value fashion brand opened 11 new stores and consolidated 10 others during the quarter. Year-on-year, the brand added 207 stores, taking its total count to 766, including two in the United Arab Emirates. Launched in 2016, Zudio crossed the ₹1,000-crore sales mark in FY25, underscoring its steady rise in the affordable fashion space.
Zudio is one of the largest value fashion retailers in the country and is also one of the fastest growing ones in the space, compared to peers such as VMart and V2 retail. The two retailers together generated a combined revenue of ₹1,517 core, the mark which Zudio crossed in the last quarter of FY25.
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“Zudio is a unique format because it offers value fashion in a luxury-type store environment,” said Satish Meena, founder of Datum Intelligence. “That’s a big differentiator compared to others like VMart or V2.”
Westside, the company’s mid-premium format, added 20 new stores during the June quarter, taking its total store count to 248. Westside’s like-for-like growth, however, remained in low single-digit during the quarter, suggesting some moderation in consumers’ discretionary spending.
“Store addition growth has sort of saturated Zudio as they’ve expanded rapidly in the last one year,” Meena added. “It’s becoming a very competitive and overcrowded space now.”
Despite softer trends in the established markets, Trent continues to push into newer tier-2 and tier-3 cities. The company said many of these emerging markets are still maturing in terms of fashion adoption and consumption density, which may result in uneven growth trajectories over time.
Trent also reported improving operating leverage, aided by investments in automation and inventory control. Operating EBIT margins, an important profitability ratio measuring revenue after the deduction of operating expenses, was 11.4% in the June quarter, up from 10.6% a year ago.
Online sales from Westside.com and Tata Neu grew 35% and now contribute over 6% of Westside’s revenue.
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“This quarter’s growth seems fine, but everything hinges on the second quarter when festival-related spending kicks in,” Meena said. “That said, 20% growth is much better than some of its peers.”
Chairman Noel Tata expressed optimism despite increasing competition. “Notwithstanding continuing competitive intensity and interim trends, we believe an unwavering focus on being relevant to our customers and building resilience with our business model choices will, over time, enable us to deliver significant value,” Tata said.
The company’s broader vision remains ambitious. In his FY25 shareholder letter, Tata reiterated his goal of growing Trent tenfold over the long term. “Two years ago, I had envisioned that Trent would one day be 10 times bigger. Since then, the revenue run rate has doubled. The headroom for growth remains enormous,” he said.
Trent’s food and grocery vertical, Star, ended the quarter with 77 stores, adding two while shuttering three. Revenue from the Star format rose modestly to ₹869 crore, but like-for-like growth remained flat. Own-brand products now make up 73% of Star’s revenue.
The grocery business has been an overall drag on the company’s profitability as it accumulated over ₹1,000 crore in losses over the previous six years.
Despite the losses, Noel Tata bets big on the grocery business. “The opportunity in the food space for the Star proposition is exciting while being competitive. We remain convinced that this business is well poised to deliver much consumer value and growth in the years ahead”, said Tata in the earnings statement.
This reaffirms the optimism he conveyed in the annual general meeting last month. He had said that the grocery business has the potential to become larger than the Tata Group-backed company’s flagship fashion brands Zudio and Westside. “This is only because the food market is much bigger than the market for clothing,” Tata had told shareholders. “So, we are convinced there’s a huge opportunity there and with time you will see that we will deliver a big business in the food and grocery space as well.”
Trent’s focus on Star comes less than a year after Noel Tata’s son Neville Tata, 32, was appointed as the business head of the grocery business.
Star competes with the likes of DMart, the country’s largest listed retailer. The Damani-backed company generated a revenue of 15,932 crore that is about 18 times more than the revenue generated by Star.
“Star doesn’t yet have a unique value proposition like Zudio,” Meena said. “It’s a tough space with entrenched competition from players like DMart and it takes much more time to scale and grow rapidly unlike what they did with Zudio.”
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