Bata India Ltd share Price

Bata India is a major player in the Indian footwear market with a presence across men’s, women’s and kid’s footwear segment. It has a pan-India presence with the largest network of retail stores with 1700+ stores. Bata has a vision to open 500 franchise stores over the next few years (current: 300).

• It has a robust balance sheet with healthy cash and bank balance worth
  ₹ 946+ crore, negative working capital cycle and generating RoCE of 20%+

Reported a mixed operational performance. Revenue recovery rate was at ~98% in Q4FY22 vs. 101% in Q3FY22 (I-direct estimate: 107%).

• On a benign base, reported revenue growth of 12.8% YoY to ₹ 665.2 crore
•                 Gross margins improved 450 bps YoY (490 bps QoQ) to 57.6%, significantly ahead of our estimates (53.6%). EBITDA margins improved 540 bps YoY to 24.4%. EBITDA grew 45% YoY to ₹ 162.2 crore
• Tracking steady operational performance, PAT grew 2.1x YoY to ₹ 63 crore

Footwear company Bata India announced Q1FY24 results:

• Revenue from operations for Q1FY24 stood at Rs 9,581 million (a growth of 2% over Q1FY23).
• The net profit stood at Rs 1,078 million for Q1FY24 lower by Rs 115 million from Q1FY23 primarily on account of the early start of the End of Season Sale by the industry.
• Aggressive network expansion – 2,100 stores in close to 700 cities, with a Franchise & SIS network consisting of over 38%. 27 stores were renovated during Q1FY24.
• Overall ASP grew by ~3% over last year.
• Successful execution of portfolio casualization strategy – Sneaker Studio implemented in 565 Stores.
• 1st Floatz banner opened with a kiosk in Delhi. Floatz achieved the highest-ever quarterly turnover with 206% TALY.
• Distribution channel continued to scale up to 1,390 towns.
• 2nd Warehouse enabled to fulfill DTC and marketplace orders. Optimized warehousing costs through relocation of warehouses.

Speaking on the Q1FY24 performance, Gunjan Shah, MD and CEO, Bata India, stated, “With our strategy of casualization and premiumization, expansion in Retail Network and accelerated investment towards core technologies (ERP, Merchandising, etc.,), we believe the template is set up for future profitable growth. Digital footprint through our omnichannel e-commerce revenue streams gained significant momentum in the quarter going by.

At Bata India, we continue to implement initiatives to elevate the customer experience at our stores and on our website. We have introduced a series of innovations to consumers like the Bata Shoe Care Program, Buy Now Pay Later, and Bata Wallet. We have gained a share in higher category articles in brands like Hush Puppies, Comfit, Floatz & North Star. We continue to add Franchise and SIS stores to improve the accessibility of the brand along with MBOs. Across all business channels of EBOs, MBOs, and E-Commerce, margins remained healthy despite slowness in discretionary demand & early onset of EOSS.

We continue to flesh out new opportunities across our value chain. We remain focused on cost efficiency across all operations and optimizing our resources. We are optimistic about the demand resurgence going ahead and continue to expand in Tier 3-5 towns, digital channels, and make investments in elevating customer experience & brand marketing.”

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