Bata shares fall 3% after weak net profit numbers

Shares of Bata fell 2.78% to Rs 1,653 crore as of 9:37 a.m. after the carrier’s net profit fell 9.6% year-on-year (YoY) to Rs 107 crore in the quarter from May. 4 to June.
Bata’s revenue increased 2% year-on-year to Rs 971 crore year-on-year. However, revenue fell short of estimates by nearly 9%, Motilal Oswal said. Gross margin fell 190 basis points year-on-year to 54.7%. Motilal Oswal said Bata saw no improvement in gross margin compared to other footwear companies. The company has yet to hold an earnings conference call. Brokers will review Bata after the conference call is over.
Management said demand remains down in the footwear sector. The moderation in demand has continued since the end of March 23. However, demand should recover and accelerate during the holiday season. ICICI Securities said in a note that Bata continues to lag behind its industry peers’ lifestyle categories in revenue growth. The brokerage added that despite efforts to normalize its product portfolio and expand its network faster through franchised stores, the company was unable to generate significant income. “We’ve introduced a range of consumer innovations such as the Bata Shoe Care Program, Buy Now Pay Later and Bata Wallet. We’ve captured market share in premium items from brands like Hush Puppies , Comfit, Floatz and North Star,” the company said in a statement. exchange profile.
Bata India is India’s largest footwear manufacturer and retailer.