Riding the wave of its success in the domestic retail market, Noel Tata-led Trent is exploring opportunities to set up its retail formats outside Indian shores, beginning with a flagship store in Dubai, said people in the know. This move comes as Zudio, one of its flagship brands, surpasses the ₹7,000-crore revenue mark in India.
Trent had earlier deferred its global ambitions to consolidate domestic operations. Now, with a robust and profitable business model in place, the traditionally conservative retailer is now seeking to tap the substantial Indian diaspora overseas, becoming the first retailer to do so, the people said. It may consider an international ally for possible partnerships, though that is unconfirmed. Chief executive officer P Venkatesalu said the company, as previously, continues to explore possibilities. “It is still early to comment on plans,” he added.
According to industry watchers, Trent has cracked a sustainable and profitable business model and has now gained the confidence to scale up abroad.
Trent’s consolidated revenue has increased at a five-year compound annual growth rate of 45%, reaffirming its growth strategy driven by agile on-ground execution. Amid an apparel slowdown, Trent stands out as an anomaly, consistently delivering positive surprises in both revenue and profit margin.
The company reported another strong growth year in FY24, with net sales surging 50% to ₹12,375 crore and net profit rising nearly fourfold to ₹1,477 crore. This robust performance was driven by a combination of strong like-for-like growth, aggressive expansion of Zudio stores and significant traction in emerging categories such as beauty and personal care, innerwear, and footwear.
In the March 2024 quarter, its fashion apparel brand Westside unit added 12 stores, bringing the total store count to 232, while value fashion concept Zudio opened 86 new stores, taking its total count to 545.
Shares of Trent gained 192% in the last one year and 305% over two years, compared with gains of 10% and 18% in the Sensex during the same periods.
Trent was the top performer among all the Tata Group stocks during these periods.
The only retailer pursuing an unconventional ‘own brands’ strategy, Trent had accelerated the expansion of its key formats – Westside, Zudio and Star Bazaar.
“Westside and Zudio are like two siblings playing in the fashion space. They vary on product, design, fabric, etc., but are still relevant at different price points. Moreover, the learnings from Westside helped build a strong Zudio model and the backend integration of the two brands is helping both businesses deliver synergistic growth,” Venkatesalu told ET.
Trent’s brands are not sold on any other ecommerce websites except Tata platforms (Tata Neu and TataCliq). The Zudio format today contributes as much as 30% to total revenue compared with only 8% a few years back.
The retailer is applying the same strategy at the Star Bazaar business in the food and grocery space and is witnessing some very strong customer traction.
It has consistently delivered robust financial results, boasting 31% and 26% compound annual growth rates (CAGR) in revenue and profit, respectively, over the past five years. Trent is now seen by its management team as a platform that allows to originate, incubate and scale a portfolio of growth engines.
