Trent’s shares have seen a decline of 43 percent in 2025.
Shares of Tata Group’s retail giant Trent, which runs budget fashion chain Judio and premium brand Westside, are heading towards an embarrassing situation. Trent stock has become the worst performing stock in Nifty in the year 2025. This multibagger stock, which was once proving its mettle, has declined by 43 percent this year, due to which its market cap has reduced by more than Rs 1 lakh crore. Also, the valuation of the company has reduced to Rs 1.45 lakh crore.
The massive selloff marks a stunning turnaround for a stock that was once a favorite of retail and institutional investors. Now Tata is leading those three companies of the group, whose shares have seen the biggest decline in the current year. Shares of Tata Motors Passenger Vehicle Company are down 22 percent. Whereas the shares of TCS, the country’s largest IT company, have seen a decline of 21 percent.
The biggest reason for this devastation in the company’s shares is the aggressive opening of more and more stores, which is causing damage to the existing stores. Decrease in consumption is affecting urban demand. At the same time, competition is continuously increasing, due to which Judio’s dominance in fashion retail seems to be in danger.
Increase in stores gave a shock
Bernstein’s analyst Jiganshu Gor says in an ET report that excessive densification of the store network is a major reason for the decline in sales growth. It also highlights an important lapse in Trent’s extension strategy. Since March 2024, Zoodio has aggressively added 285 net stores, taking its network from 539 to 824 outlets. But this growth had to be paid at a price. 58% of existing stores now face competition from a new Judio located in the same city.
At the PIN code level, 11 per cent of stores are now competing with sister outlets for the same customers—a strategic mistake that is only beginning to reverse in FY2026, with only 3 per cent of the network experiencing same-PIN overlap.
reduction in consumption
Dalal Street veteran Saurabh Mukherjee, whose PMS firm holds a key position in the Marcellus Trent, also acknowledges the difficult situation. In the ET report, he said that the slowdown in consumption is affecting everyone including Trent. However, he says that the company has maintained better same store sales growth compared to rivals like Reliance Retail and Aditya Birla Fashion Retail. He said that we are in a very comfortable position with a large stake in Trent and are betting on continued fiscal stimulus till 2026 to revive consumption demand.
Judeo dominance in danger
According to Bernstein, the budget fashion chain, which fueled Trent’s growth by gaining share from unorganized companies, still has strong brand appeal, with strong Google search interest and social media engagement. But new entrants, Yusta, Style Union, OWND and Intune have collectively opened 358 stores, with pincode overlap affecting 27 per cent of Judio’s network.
Goldman Sachs estimates that Zoodio’s market share will grow from the current 1.5 percent to 5 percent over the long term, arguing that most competitors “have not yet established strong store economics” and that Zoodio’s costs—no advertising, minimal discounts, and double the sales of rivals—create a strong moat. Goldman Sachs says it took more than five years for Zoodio to optimize its model before explosive growth began.
How was the performance in the second quarter?
Recent financial data is giving mixed signals. In Q2FY26, Trent’s revenue grew 15.9% year-on-year (YoY) to Rs 4,818 crore, with Westside and Zoodio’s combined revenue growing 20.9% to Rs 3,939 crore. EBITDA grew 26.5% to Rs 817 crore, while margins expanded 150 basis points to 17%, reflecting strong operations and cost discipline. PAT increased by 11.4 percent to Rs 373 crore. But due to store upgrades and stiff pricing competition, the food and grocery segment declined by 2.1 percent to Rs 879 crore.
Bernstein believes that Trent’s revenue growth is currently at a low level. CAGR is estimated at 19 percent in FY 2026 and 20 percent by FY 2028, which has been possible due to improvement in like-for-like sales across individual stores, continuous network expansion and better consumer demand. However, margins are “at peak” and further growth is expected to be modest. Management is making long term strategy. Analysts say that the company is considering choosing options that will benefit its brands in the long run, even if it may cause short-term losses.