📌 At a glance:
Bata India’s Q4 FY25 results were a mixed bag of volume growth optimism and profit margin pessimism. Revenue dipped slightly YoY, and operating profit slid over 35%. But hey, at least they’re throwing shoes and dividends. Final dividend of ₹9 declared, taking total to ₹19 for the year. Meanwhile, gross inventory was tightened by 15%, a clear attempt to declutter both stores and spreadsheets.
🥾 About the Company
- Founded: 1931, Kolkata
- Business: India’s largest footwear brand — from school shoes to CEO loafers
- Network: 1,962 stores (COCO + Franchise)
- Volume Sold (FY25): Estimated ~50 million pairs
- Product Portfolio: Red Label, Comfit, Power, NorthStar, Floatz, Bubblegummers, Hush Puppies
- Distribution: D2C, Multi-brand outlets, Marketplaces, Franchisees
🧑💼 Key Managerial Personnel
| Name | Designation |
|---|---|
| Gunjan Shah | MD & CEO |
| Nitin Bagaria | AVP (Special Projects) & Company Secretary |
💰 Financials (Q4 FY25 + FY25 Highlights)
| Metric | Q4 FY25 | Q4 FY24 | YoY Change |
|---|---|---|---|
| Revenue from Ops | ₹787.8 Cr | ₹797.7 Cr | 🔻 -1.2% |
| Operating Profit (EBIT) | ₹37.4 Cr | ₹58.3 Cr | 🔻 -35.8% |
| EBITDA Margin | ~4.75% | ~7.3% | 🔻 |
| Final Dividend | ₹9/share | ₹13/share (total) | — |
FY25 Total Dividend: ₹19/share → ₹244.2 Cr payout
Gross Inventory: ₹815 Cr (down 15% YoY)
📦 Business Strategy Breakdown
✅ Volume-Led Growth:
- Franchise & e-commerce channels leading the charge
- 2nd straight quarter of volume expansion
- 19 new franchise stores added this quarter, mostly in semi-urban towns (Bharat FTW)
🧠 Inventory Fixing Saga:
- Gross inventory slashed 15% YoY
- Tightening on both quantity and quality
- Focus on stock turns and forecast accuracy to boost agility
🏪 Zero-Base Merchandising (ZBM):
- Rolled out to 146 stores
- Purpose: Less clutter, better consumer experience, higher revenue/sqft
- Think of it as KonMari method, but for shoes
📈 Forward Value (FV) Estimate
Let’s attempt a forward valuation using some back-of-the-napkin Edu math:
- FY25 Revenue: ₹3,040 Cr (assuming similar quarterly run rate)
- Net Profit Est (normalized): ₹180–₹200 Cr (adjusting for Q4 hit)
- EPS Estimate: ~₹14–₹15
- Industry P/E: 45x (premium retail/consumption brand)
🎯 Forward FV: ₹630–675 range
(Current CMP: ₹1,279 — so the market is pricing in a BIG comeback already.)
🔮 Growth Outlook FY26
- Tailwinds:
- Urban revival + monsoon + marriage season = more walking, more buying
- Brand recall in Tier 2/3 still strong
- Healthy expansion via asset-light franchise model
- ₹9 dividend = shareholder smile therapy
- Headwinds:
- Rising costs, muted urban discretionary demand
- Thin operating margins mean any revenue miss stings
- D2C and sneaker upstarts (Campus, RedTape, Puma) eating into share
🧠 EduInvesting Take
Bata’s boardroom clearly read a self-help book titled “Declutter Your Life, Declutter Your Inventory”.
Volume growth is great — but when margins look like thin crust pizza and inventory control becomes the headline, you know it’s less “Profit Runway” and more “Cost Optimization Yoga.”
The stock has already run up, pricing in recovery. So FY26 will have to walk the talk — literally.
Also, props for still paying ₹244 Cr in dividend. Shareholders may not be getting profit, but they’re getting pyaar.
🚨 Risks & Red Flags
- Margin erosion despite stable topline = trouble
- No PAT/PBT breakup disclosed = why so shy?
- Franchising works… unless it dilutes brand perception (looking at you, Bata Bhawanipur vs Bata Bandra)
📅 Published: May 28, 2025
✍️ By: Prashant Marathe
Tags: Bata India, Q4 FY25 Results, Footwear Sector, Dividend Announcement, Franchise Growth, EduInvesting, Retail Stocks, Inventory Management, Gunjan Shah, Indian Consumption Play
