Here’s why retail stocks are rallying this week

Retail stocks are rallying this week for various reasons. Trent has moved almost 12 percent this week, a big move of almost 18 percent on Shoppers Stop, Aditya Birla Fashion and Retail (ABFRL) has seen a near 15-16 percent move and V-Mart Retail high single digit rise.

Trent has gained on account of F&O inclusion. Aditya Birla Fashion held analyst meet and they expect Rs 500 crore worth free cash flow over FY21-FY26. They also have a strong plan for their ethnic and innerwear that is likely to contribute almost 30 percent to their incremental growth.

Shoppers Stop did see recovery of 50 percent in their footfalls in Q3. Their footfalls have actually moved close to pre-COVID levels in non-metros.