Multibagger Tata Group stock hits record high as Citi gives buy call

Shares of multibagger Trent Ltd hit their record high in early deals on Thursday after global brokerage Citi initiated coverage on the Tata Group stock with a 'buy' call. It has assigned a price target of Rs  9,250 on the retail stock, a 21% upside to the previous close. It has included the stock in its Pan-Asia high-conviction focus list.

The Tata Group stock has risen 463% in two years and gained 269% in a year. The stock has delivered 702% returns in three years. 

Brokerage Citi said Trent is leveraging its supply chain and insights from Westside and Zudio, turning around its Star Bazaar business. Trent is well-positioned to scale up its other pilot projects, such as MISBU, Samoh, and its joint venture with MAS, said the brokerage. 

The brokerage said the firm has transformed from a single-format to a multi-format player, which led to a 36 percent revenue CAGR from FY19 to FY24. As a multi-category player in fashion, lifestyle, grocery, and personal care, Trent reported industry-leading revenue, EBITDA, and PAT CAGRs of 41 percent, 44 percent, and 56 percent, respectively, for FY24–27.

Tren stock climbed 4.32% to its record high of Rs 7,939 in early deals today. 

The multibagger stock is overbought on charts as the relative strength index (RSI) of the stock stands at 77.4.  Shares of Trent arte trading higher than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day, 150 day and 200 day moving averages which means they are trading in bullish  zone in both long and short terms.

It has seen low volatility in the last one year with its beta at 0.8.

Total 0.19 lakh shares of the firm changed hands amounting to a turnover of Rs 14.75 crore on BSE. Market cap of the firm stood at Rs 2.78 lakh crore on BSE. The Tata Group's multibagger stock hit a 52-week low of Rs 1946.5 on October 26, 2023.

Trent reported a 225% year-on-year rise in consolidated net profit for the June quarter. Net profit climbed to Rs 391 crore in Q1 against net profit of Rs 167 crore in the corresponding quarter of last fiscal. Revenues rose 56% to Rs 4104 crore compared to Rs 2628 crore in the corresponding quarter a year ago. 

EBITDA or earnings before interest, taxes, depreciation and amortisation zoomed 199% on-year to Rs 400 crore against Rs 266 crore in the year-ago quarter. 

Trent Limited is part of the Tata Group and operates a portfolio of retail concepts. The primary customer propositions of Trent include Westside, one of India's leading chains of fashion retail stores, Zudio, a one stop destination for great fashion at great value and Star, which operates in the competitive food, grocery and daily needs segment.