Zudio, Trent's greatest strength, may also be its biggest weakness

Trent Ltd, the parent firm of well-known brands such as Westside and Zudio, has been one of the fastest-growing companies in India's retail sector over the past five years, with its stock having surged about 935% since the start of the pandemic in March 2020.

- Dipti Sharma

However, it has also been the worst-performing Nifty 50 stock so far this year—down about 26% since 1 January—making investors jittery. The company's enterprise-value-to-Ebitda ratio (EV/Ebitda) fell from 78.5 in FY24 to 67.6 in FY25, and is expected to decline further to 51 in FY26, according to Bloomberg data.

Jay Gandhi, analyst at HDFC Securities, noted the stock's surge from around ₹2,000 in August 2023 to more than ₹8,000 in October 2024 was powered by aggressive expansion and rising productivity of Zudio stores—both of which are now losing steam, leading to the correction. Zudio is Trent's fast-fashion brand that offers affordable clothing to budget-conscious customers.