Trent is the retail arm of the Tata Group and was originally called the Lakme Group before it was renamed to Trent. Over the last few years, the Tata Group has been making an effort to consolidate all its retail businesses under the Trent umbrella.

Trent Ltd. fourth quarter results

Trent reported a 37% growth in Q4 profits to Rs.16 crore even as total income went up by 25.6% in the fourth quarter to Rs.677 crore. Trent sells most of its merchandise under the brand name of Westside and has seen a record 27 new stores opened in the last calendar year.

Should you look to buy Trent at current prices?

The stock currently quotes on the NSE at Rs.354 and has already seen a sharp appreciation in price in the last couple of years. However, the stock is quoting at a very expensive valuation of over 95 X P/E ratios. That is substantially higher than the market average for retail companies and only Avenue Supermarts (owners of the D-mart brand) command that kind of market valuations. While we do see value in the Trent stock over the next 2 years, short term upsides could be fairly limited.