Trent Q4, Revenue at ₹3,298 crore up by 51%, net profit jumps multifold

Trent Ltd announced its Q4FY24 results on 29-Apr-2024. The stock closed at ₹4,351.45 on BSE showcasing a 1.08% gain from previous day’s closing.

Revenue

Consolidated net revenue of Trent Ltd in Q4FY24 stood at ₹3297.7 crore, which rose by 51.08% YoY from ₹2182.75 crore in Q4FY23. The consolidated revenue for FY24 stood at ₹12,375 crore which is 50% more than the last year’s revenue which was at ₹8,242 crore. The jump in revenue is attributed to store expansion. Throughout the quarter, the company expanded by opening 12 new Westside stores, 86 new Zudio stores, including 25 new cities, spanning 65 cities.

Store Count

Westside: 232 outlets Zudio: 545 outlets Other lifestyle concepts: 34 stores

EBIT

EBIT stood at ₹300 crore in Q4FY24 that rose by 400% YoY. For Q4FY23, it had posted an EBIT of ₹59 crore. EBIT stood at ₹1,251 crore in FY24, which rose by 116% YoY from ₹580 crore in FY23. EBIT margin as of Q4FY24 was at 8.2% that increased by 5.4% YoY against the same quarter, the previous year.

Segmental Highlights

Emerging categories which include beauty & personal care, innerwear and footwear continue to gain traction. These emerging categories now contribute over 20% of the company’s standalone results.

Westside.com and its proposition on the Tata Neu platform is now contributing over 6% of Westside’s overall topline.

Star business, consisting of 66 stores, continued to witness improved revenues for Trent’s hypermarket business. The business registered a 30% growth in operating revenue in Q4FY24 as compared to the previous period last year.

Net Profit

The consolidated net profit in Q4FY24 came in at ₹ 712 crore which rose by 1482% aided by one time exceptional gains of ₹543 crore , as compared to Q4FY23, when it reported ₹45 crore.. The net profit margin expanded substantially Q4FY24 to 21.59% which expanded by 1,953 bps. The net profit margin for Q4FY23 was 2.06%.

Trent’s bottomline was aided by a one time gain of ₹543 crore during the quarter, as it entered into a substantial number of lease contracts, for store operations, which resulted in the exceptional gain.

The consolidated net profit for FY24 stood at ₹1,477 crore showcasing a 275% growth in profit from FY23 which was at ₹394 crore. Despite the challenging environment in FY24, the operating discipline and accelerated expansion with strong execution is driving the performance.

Management Commentary

"We will continue to expand and deepen store presence with the aim of being ever closer and convenient to customers reinforcing our brand promise. We have applied Trent’s playbook to the Star business and are witnessing strong customer traction." said Noel N Tata, Chairman, Trent Limited.

"This reinforces our conviction to build out this growth engine in the food, grocery, and general merchandising space. The success of own branded products also augurs well for the Star business. We are confident that this business is well poised to shift gears and deliver substantial value to customers and shareholders going forward." he added.

Stock Return and Dividend

Over the past six months, the stock has delivered an impressive return, doubling investors’ money with a remarkable 105% increase in value. The company's Board of Directors proposes a dividend of 320%, equivalent to ₹3.20 per equity share of ₹1 each, pending shareholder approval.