Bata India (500043) Q3 24/25 earnings summary

Executive summary

• Focused on growth and efficiency through store-centric initiatives, portfolio expansion, digital growth, and operational simplicity.

• Zero-Based Merchandising (ZBM), value proposition simplification, and digital footprint expansion are key levers, with ZBM piloted in 17 stores and plans for rapid expansion.

• Strategic brand campaigns, new product launches, and festive season sales supported brand momentum, especially for Floatz and Power.

• Franchise network surpassed 600 stores, up from under 100 three years ago, with 605 franchise stores by Dec'24.

• Unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2024, were approved and released following a board meeting on February 10, 2025.

Financial highlights

• Consolidated revenue from operations for Q3 FY25 was Rs. 9,187.94 million, up from Rs. 9,034.72 million in Q3 FY24; nine-month revenue was Rs. 27,005.72 million, up from Rs. 26,807.39 million year-over-year.

• Gross margin improved by 17 basis points to ₹515.6 crore; EBITDA margin expanded by 141 basis points to 22.7%.

• Consolidated net profit for Q3 FY25 was Rs. 586.99 million, compared to Rs. 579.77 million in Q3 FY24; nine-month net profit was Rs. 2,847.41 million, up from Rs. 1,988.62 million year-over-year.

• Reported PAT was ₹58.2 crore, flat year-over-year, impacted by an exceptional VRS item.

• Volume growth turned positive for both the quarter and nine-month period.

Outlook and guidance

• ZBM rollout to focus on top 250-300 COCO stores, targeting those contributing to 50% of turnover.

• Continued focus on expanding franchise and distribution network, digital sales, and omni-channel strategies.

• Net store additions to resume after ongoing rationalization, aiming for 30-40 EBOs per quarter.

• Interim dividend of Rs. 10.00 per share and final dividend of Rs. 12.00 per share were declared and paid during the nine months ended December 31, 2024.

• Ongoing investment in marketing to attract younger demographics.