Trent's margin slips sequentially despite +19.23% YoY revenue growth
Costs grew faster than revenue QoQ, while net profit benefited from a lower tax rate even as other income contributed little.
Filed 22 Apr 2026, 19:48 IST · after market close · Trent Ltd (TRENT)
Key takeaways
- Consolidated Q4FY26 revenue grew +19.23% YoY, but fell -5.93% QoQ as the festive-quarter base eased.
- Operating margin expanded 2.98 percentage points YoY to 18.44%, but narrowed 1.79 percentage points QoQ as costs grew faster than revenue.
- Net profit rose +32.57% YoY to Rs 413.10 cr, with the lower 20.38% tax rate also supporting the increase.
Price around the results
Revenue growth held up, but momentum slowed from Q3
Consolidated revenue grew +19.23% YoY, ahead of the +15.03% increase in expenses, lifting operating profit +42.23% and expanding operating margin by 2.98 percentage points. Sequentially, revenue fell -5.93% while expenses declined only -3.83%, so operating profit dropped -14.22% and margin narrowed 1.79 percentage points. Net profit rose +32.57% YoY but declined -19.02% QoQ.
Lower tax aided profit; other income was not a major factor
The tax rate fell 4.67 percentage points YoY to 20.38%, which supported the +32.57% increase in net profit despite interest rising +16.60% and depreciation rising +38.46%. Other income fell -83.85% YoY and represented only 2.28% of pre-tax profit, so reported earnings were not materially dependent on non-operating income. Sequentially, the tax rate also fell 4.15 percentage points.
Margin remains above peers but has given back part of Q3's gain
Trent's 18.44% operating margin was 3.63 percentage points above the 14.81% median for the 93 Consumer Discretionary peers that had reported the quarter. The quarterly trend was uneven: margin moved from 17.36% in Q1FY26 to 16.96% in Q2FY26, rose to 20.23% in Q3FY26 and then declined to 18.44% in Q4FY26. This leaves the latest margin above Q4FY25, but below the preceding quarter.
Store expansion and digital channels remain central to management's plan
Management said the company opened 23 Westside and 109 Zudio stores in Q4FY26, after opening 60 Westside and 212 Zudio stores during FY26. The company said it has maintained a pace of about 250 new stores annually and believes newer markets can offer substantial opportunities as they mature. Management also said the Board approved in principle a proposal to raise about Rs 2,500 cr for store upgrades, new brands and geographies, supply-chain capacity, digital initiatives and Star expansion.
The stock reaction was weaker than Trent's typical post-results move
The stock fell -4.13% on the first trading day after the results and was down -6.54% after five sessions and -7.86% after 30 sessions. The day-one decline exceeded the stock's median absolute post-results move of 3.17%, although its history is evenly split between four up and four down reactions across eight results. The first-day move occurred alongside 3.1x normal volume and a corporate-action overlap; the stock underperformed the benchmark by -3.29% that day.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹5,028 cr | ₹5,345 cr | -5.93% | +19.23% |
| Other income | ₹12 cr | ₹5 cr | +160.00% | -83.85% |
| Expenses | ₹4,101 cr | ₹4,264 cr | -3.83% | +15.03% |
| Operating profit | ₹927 cr | ₹1,081 cr | -14.22% | +42.23% |
| Operating margin (%) | 18.44% | 20.23% | — | — |
| Interest | ₹44 cr | ₹43 cr | +1.89% | +16.60% |
| Depreciation | ₹377 cr | ₹367 cr | +2.69% | +38.46% |
| Profit before tax | ₹519 cr | ₹676 cr | -23.24% | +24.80% |
| Tax | ₹106 cr | ₹166 cr | -36.22% | +1.56% |
| Net profit | ₹413 cr | ₹510 cr | -19.02% | +32.57% |
| EPS (₹) | ₹11.26 | ₹14.42 | -21.91% | +25.81% |
Operating margin of 18.44% compares with a Consumer Discretionary sector median of 14.81% across 93 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | -4.13% | -3.29% |
| Next session | -3.09% | — |
| 5 sessions | -6.54% | -4.98% |
| 15 sessions | -7.51% | — |
| 30 sessions | -7.86% | — |
Volume on the results session was 3.10× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- In Q4FY26, the company opened 23 Westside and 109 Zudio stores and consolidated one Westside store.
- Westside online revenues grew 25% in Q4FY26 and contributed over 6% of Westside revenues.
Guidance & outlook
- The company has consistently launched about 250 new stores annually across its brands over the last few years.
- The company believes newer markets offer substantial growth opportunities as they mature over time.
- The company aims to grow its presence and share of revenues by selectively increasing density across key markets.
Expansion
- The Board approved in principle a proposal to raise about Rs. 2,500 crores for selected investments.
- The proposed funds would support store upgrades, new brands and geographies, supply-chain capacity, digital initiatives and Star expansion.
- The company opened 60 Westside and 212 Zudio stores during FY26.
New initiatives
- The company is pursuing automation and optimisation interventions across its value chain.
- Digital, technological and AI-driven interventions are being developed across product design, logistics, warehousing and store operations.
- Pan-network RFID has improved productivity across supply-chain processes and in-store operations.
Competition
- The company says competitive intensity has been high in recent years, with no material shifts currently observed.
Problems & risks
- Consumers are spending cautiously, moderating discretionary spending amid macroeconomic uncertainty and potential cost-of-living increases.
- Middle East disruptions and their effects on supply chains, commodity prices and inflation could affect near-term demand.
- Select raw materials are seeing inflationary pressure and supplier labour availability is affected in some geographies.
What to watch
- Whether operating margin recovers from 18.44% after the 1.79 percentage-point QoQ decline.
- Store additions against the 109 Zudio and 23 Westside openings in Q4FY26 and management's stated pace of about 250 stores annually.
- Disclosures on the proposed Rs 2,500 cr fund raise and its allocation across stores, brands, geographies and supply-chain capacity.