Bata India Ltd
(NSE:BATAINDIA)
₹
670.45
-6.9 (-1.02%)
Market Cap: 86.18 Bil
Enterprise Value: 94.78 Bil
PE Ratio: 59.51
PB Ratio: 5.45
GF Score: 74/100 
Q1 2027 Bata India Ltd Earnings Call Transcript
Aug 13, 2026 / 11:00AM GMT
Release Date Price:
₹727.65
(+1.75%)
Key Points
Positve
- Bata India Ltd (BOM:500043) reported a 4% revenue growth to INR 979 crores, driven by both volume and value growth.
- Underlying PBT grew by 22%, showcasing strong operational efficiency and profitability.
- The company crossed a significant milestone of 2,000 EBO stores, becoming the first brand in the country to achieve this, with plans to expand to 3,000.
- Full price sales reached nearly 90%, a continuous improvement over the last four to five quarters, indicating better pricing power and reduced discounting.
- Inventory management improved, with stock turns at an industry-best of 2.5-plus, edging towards 2.7, while maintaining high product availability.
- The company's ZBM (Zone Based Merchandising) initiative now covers 80% of business-contributing stores, driving better store productivity and consumer experience.
- Strong growth in premium brands like Hush Puppies and Floatz, along with a robust performance in the ladies category, supported by successful marketing campaigns.
- The company is investing heavily in A&P (up 25% YoY) to support new product launches and brand building, which is expected to drive future growth.
- Gross margin expanded by 130 basis points, with an underlying improvement of 230-240 basis points when adjusted for channel mix, reflecting better product mix and lower markdowns.
- The company is on track with its vendor consolidation program, reducing partners from over 100 to below 70, aiming for 30 core partners, which is expected to yield significant cost savings.
Negative
- Bata India Ltd (BOM:500043) faces elevated raw material costs, particularly for synthetic materials derived from crude oil, with a cost push of 5-6% expected to impact margins in the coming quarters.
- The company has taken price increases to mitigate cost inflation, which could potentially impact consumer demand, especially in the lower price segments.
- The North Star brand underperformed, acting as a drag on overall sneaker sales, though this was partly due to conscious rationalization of current lines.
- The company does not provide forward-looking guidance, leaving investors uncertain about future revenue growth and margin trends.
- Channel mix dilution, particularly from faster-growing franchise and e-commerce channels, negatively impacted gross margins by approximately 100 basis points in the quarter.
- The delayed monsoon led to a deferment of revenues, which could affect short-term sales performance.
- A&P expenses are expected to remain elevated at 3-3.5% of sales, which could pressure operating margins in the near term.
- The company is still in the process of reimagining its product funnel, with significant changes expected only by H2 FY27, indicating a longer timeline for full impact.
- Competitive intensity in the lower price points remains uncertain, and the company has not yet seen clear benefits from unorganized players facing cost pressures.
- The company's employee costs have been flat, partly due to VRS and restructuring, which may indicate underlying operational challenges or a need for ongoing cost rationalization.
Operator
Ladies and gentlemen, good day and welcome to the Bata India Limited Q1 FY27 earnings conference call hosted by Ambit Capital Private Limited. (Operator Instructions) Please note that this conference is being recorded.
I would like to hand the conference over to Mr. Aryan Garodia from Ambit Capital Private Limited. Thank you, and over to you, sir.
Aryan Garodia
Ambit Capital Private Limited - Analyst
Hi. Good evening, everyone. On behalf of Ambit Capital, I thank the management of Bata India for the opportunity to host their Q1 FY27 earnings conference call. Joining us from the management today we have Mr. Gunjan Shah, MD and CEO, Mr. Amit Aggarwal, CFO, and Mr. Nitin Bagaria, AVP and company secretary. I would like to hand over the call to Nitin for the opening remark, post which the forum will be open for the question and answer session. Thank you, and over to you, Nitin.
Nitin Bagaria
Bata India Ltd - Assistant Vice President - Special Projects, Compliance Officer, Company Secretary
Thank you, and good
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