Trent under pressure as Kotak initiates coverage with 'reduce' rating

Trent, the retail arm of Tata Group which houses brands like Westside, Zudio as well as a partnership with Zara fell in trade on Friday as Kotak initiates coverage on the stock with the reduced rating. Kotak likes the business as an opportunity but believes that the valuations of the company are extremely rich.

Factoring in compounding of almost 28 percent on the company's topline and 32 percent jump in the company's net profit over the next three years, it still believes that the stock at current valuations trades around 60 times December 2024 price to earnings, which is steep.

As a result of which, Kotak believes that the fair value of the stock should be around Rs 1,320 odd and that is the target price it has set on the stock.