Bata India posts third straight drop in profit on tepid demand, one-time charge

Campus Activewear

27/10/2025 14:03

Oct 27 (Reuters) - Bata India BATA.NS posted its third straight decline in quarterly profit on Monday, hurt by customers postponing purchases in anticipation of the government's tax cuts and a one-time expense related to a voluntary retirement scheme at one of its factories.

The footwear retailer reported a 73.3% drop in second-quarter profit, but said it is expecting signs of recovery during the festive season.

Bata's consolidated profit came in at 139 million rupees ($1.58 million) for the July-to-September period, compared to 519.8 million rupees ($5.91 million) a year ago.

The Indian government's sweeping goods and services tax (GST) cuts went into effect on September 22.

The company also reported an additional expense of 82.7 million rupees due to a voluntary retirement scheme at a manufacturing unit. It added, without disclosing details, that disruption in one of the firm's largest warehouses in July had a temporary business impact.

Bata, which sells brands such as 'Hush Puppies' and 'North Star' in India posted a consolidated revenue from operations of 8.01 billion rupees, 4.3% lower from a year ago.

For more earnings highlights, click here

KEY CONTEXT:

A slowdown in discretionary spending across India's urban centers, due to the high cost of living and sluggish wage growth, has weighed on earnings of footwear retailers, including rivals Metro Brands METB.NS and Campus Activewear CAMU.NS. Campus is yet to post its quarterly results.

Bata India has been focusing on casual and athleisure lines to attract younger consumers amid a broader retail slowdown. However, analysts expect demand to rebound in the ongoing festive quarter, supported by recent tax cuts and improving consumer sentiment that could boost the sector.

"While overall the (second-quarter) did have muted demand adversely impacted by the GST 2.0 transition, we are seeing positive signs of recovery this festive season post September 22," Bata India CEO Gunjan Shah said in a statement.

PEER COMPARISON

Valuation (next 12 months)
Estimates (next 12 months)
Analysts' sentiment
RIC
PE
EV/EBITDA
Revenue growth
Profit Growth
Mean rating
# of analysts
Stock to price target
Div yield (%)
Bata India Ltd
BATA.NS
52.97
19.20
6.59
23.11
SELL
9
1.09
1.63
Metro Brands Ltd
METB.NS
65.70
33.20
15.68
20.96
BUY
21
0.88
0.44
Campus Activewear Ltd
CAMU.NS
51.27
27.03
12.66
23.90
BUY
9
0.96
0.35

STOCK PERFORMANCE CHART

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($1 = 87.8950 Indian rupees)

Bata FY26Q2 https://fingfx.thomsonreuters.com/gfx/mkt/egpbqzxxqvq/Screenshot%202025-10-24%20154039.png

 (Reporting by Mridula Kumar in Bengaluru; Editing by Shailesh Kuber)

 ((Mridula.Kumar@thomsonreuters.com;))