With revenue at Rs 8,413 mn, Bata India shows resilient recovery in Q3FY22

Backed by improved sales during festive season and re-opening of economy, footwear major Bata India Ltd has reported revenue from operations at Rs 8,413 million and profit before tax at Rs 972.79 million for the third quarter ended December 31, 2021, as against profit before tax of Rs 500 million in the quarter ended September 30, 2021, showcasing a resilient and sustainable recovery.

Sales up to pre-Covid levels

The company continued the focus on key thrust areas of franchise & MBO expansion, consumer relevant communication, portfolio casualization and digital footprint expansion. All these have resulted in increase in footfalls across retail outlets, along with significant growth driven via e-commerce platforms and expansion in Tier 3-5 towns. This resulted in revenue moving ahead of pre-pandemic levels. Despite the uncertainties because of 3rd wave towards the end of quarter, we are optimistically looking forward to faster recovery post the wave subsiding.

Continuous focus on optimising costs across value chain

The company continued to optimise its retail network and look for cost-savings across rentals & operations, manufacturing, and drive efficiencies in its value chain. All the cost-focused initiatives that have been put in place across multiple work streams continue to gain momentum and have shown positive impact quarter on quarter.

Speaking on the company’s performance, Gunjan Shah, MD and CEO, Bata India, said, “In this quarter, we saw significant improvement in customer sentiment. Additionally, we kept expanding our reach through new franchise stores & multi-brand outlets. We opened 34 new franchise stores, expanded availability via distribution channel that scaled up to 1,000+ towns. We have enhanced our portfolio in casual category led by Hush Puppies, Bata Red Label and renewed sneaker category with North Star & Power styles. With consumers preferring sneakers, we strengthened our sneaker proposition by rolling out our new ‘Sneaker Studios’ to display upto 300 styles, 9 brands in stores and on bata.in, our first sneakers campaign and expanding availability across all stores. Sneakers, thus, led the growth recovery in the quarter while formal & fashion also recovered significantly. We continued upshift in marketing investments with new ‘Surprisingly Bata Festive’ and ‘Unlimited Sneakers at Bata’ campaigns, which elevated our consumer connect. We also reached 100% full vaccination in all our eligible employees across locations during the quarter.”

Simultaneously, Bata continued its strong focus on cost-savings measures across its network, controlling discretionary spends and enhancing productivity. These measures have laid the foundation that will help the company capture the emerging consumer demand efficiently. “Innovation via agile product creation, scaling up digital channels, expansion in Tier 3-5 towns, and productivity enhancement will continue to be a priority along with safety of our employees and customers,” Shah added.

Owing to decline in Covid cases and vaccine rollout for the 15-18 age group, Bata optimistically looks forward to quick rebound in consumer sentiments.

Key Highlights for Q3 FY2022:

Bata continued with its retail expansion drive in tier3-5 cities through franchise route, taking the overall tally to 285+ as on date. Twenty-five all new women stores were added. Resumed store renovation strategy to enhance customer experience.
The company continued to expand Distribution Business byadding 50 towns to cross presence across 1000 towns.
Sales through digitally enabled channels continued its momentum driven by 3 levers – D2C bata.in e-store, Marketplaces and Omnichannel Home Delivery and contributed INR ~90 Crores to total sales which was more than double of pre-covid levels.
Continued growth of sneaker category that led the growth recovery vs rest of other categories. The Sneaker Studio pilot was scaled up across the country to display up to 300 styles across 9 brands.1st sneaker campaign was rolled out to drive new portfolio, which led to increase in sneaker & casuals style contribution in the sales mix. Basis the strong growth, the Sneaker Studio visual merchandising concept is being expanded to more stores during the next quarters.
Marketing campaign investments were dialed up with 2 large ATL & digital campaigns behind ‘Surprisingly Bata’ and ‘Unlimited Sneakers at Bata’. Bollywood actor Disha Patani was onboarded as brand ambassador to inspire Indian Youth with our new Sneaker, Casual & Fashion collections