BATAINDIANSEQ4 FY26June 8, 2026

Bata India Limited

6,360words
87turns
7analyst exchanges
4executives
Management on call
Gunjan Shah
MANAGING DIRECTOR AND
Amit Aggarwal
DIRECTOR FINANCE AND
Nitin Bagaria
AVP, COMPANY SECRETARY – BATA INDIA LIMITED
Angad Dhaliwal
360 ONE CAPITAL
Key numbers — 36 extracted
75%
to say that we are already at 550 stores as of last quarter, and our plan is to take it to almost 75% to 80% of the network by this quarter end. It did show delta growth, and that's the measure that
80%
that we are already at 550 stores as of last quarter, and our plan is to take it to almost 75% to 80% of the network by this quarter end. It did show delta growth, and that's the measure that we have
rs,
omnichannel network in place, we now have almost 700-plus stores that are fulfilling online orders, therefore, leveraging the same inventory on a better turn on a better sales turnover. What that do
28%
ights on inventory and customer availability project. The inventory continues to reduce. It's now 28% down over 2 years consecutively year-on-year and 13% down over last year. This is despite that
13%
The inventory continues to reduce. It's now 28% down over 2 years consecutively year-on-year and 13% down over last year. This is despite that the availability has gone up by almost 1,000 basis poin
1,000 basis point
-on-year and 13% down over last year. This is despite that the availability has gone up by almost 1,000 basis points. And it also has come at a significant impact in terms of 30% reduction in terms of complexity.
30%
as gone up by almost 1,000 basis points. And it also has come at a significant impact in terms of 30% reduction in terms of complexity. So fresher stock, much more better availability across sizes, a
5%
Yes, Amit. Amit Aggarwal: Like Gunjan mentioned, we had the second consecutive quarter of about 5% plus value growth. Moderator: Sorry, you're sounding muffled. Can you just repeat the last part
94%
plus growth. From a reported PBT perspective, while the reported number shows a decline of about 94%, by a couple of exceptional items, which we had clarified and informed. This was towards the clos
10%
from the quarter perspective also, our employee cost is lower by about 10%. And this benefit is flowing from -- to the employee cost line item on a structural basis. The
INR220 million
losing liability has to be translated at the closing exchange rate that led to an impact of about INR220 million, as mentioned in our notes. Third item, which is not mentioned, is a lower gains on account of le
INR84 million
a lower gains on account of lease closures. So last year, similar quarter, we had a gain of about INR84 million. This forms part of other income. While in the current quarter, that gain on account of store clo
Guidance — 20 items
Angad Dhaliwal
opening
“On behalf of 360 ONE Capital, I would like to welcome you all for 4Q FY26 Conference Call of Bata India.”
Gunjan Shah
opening
“And that comes to the next chart highlights on inventory and customer availability project.”
Gunjan Shah
opening
“So fresher stock, much more better availability across sizes, at a much better turn is obviously the whole outcome of this project, and I think it is on track for the outcome that we wanted on that.”
Gunjan Shah
qa
“So it's a very critical part of that project that availability actually should improve further.”
Gunjan Shah
qa
“So we are reasonably hopeful of the trajectory on gross margins going forward, which will be visible to you.”
Amit Aggarwal
qa
“So there will be a gross margin dilution from an optical perspective, while in reality, the dilution doesn't happen, right?”
Gunjan Shah
qa
“As of now, we don't see a direct impact, but we have obviously taken in the judicious price elasticity that we need to apply, right, going forward.”
Gunjan Shah
qa
“So those are more structural, and I guess will be perennial.”
Gunjan Shah
qa
“So that anyways gets covered and therefore, insulated from it, but there will be some impact.”
Gunjan Shah
qa
“But over the next 12 months, there will be a massive amount of upliftment of product from a central product design perspective that we have invested in capabilities, etcetera, pivoted around 3 large pieces, technology, comfort as well as style.”
Risks & concerns — 11 flagged
And therefore, I think this pressure that was there on less than 1,000 seems to have become a little better from a momentum perspective, especially in the last quarter.
— Gunjan Shah
What that does do is obviously put a lot of pressure in terms of making sure that we are able to replenish the stores much faster.
— Gunjan Shah
From a reported PBT perspective, while the reported number shows a decline of about 94%, by a couple of exceptional items, which we had clarified and informed.
— Amit Aggarwal
So the closing liability has to be translated at the closing exchange rate that led to an impact of about INR220 million, as mentioned in our notes.
— Amit Aggarwal
So these are the 2 reasons why you do not see the impact of higher fresh price sales in the gross margin.
— Amit Aggarwal
And minimum wage hike, sir, because Haryana, UP, Karnataka, all have seen very high magnitude of minimum wage hikes and any foresee -- and these might not reverse even as the RM pressure or the war pressure goes away.
— Sameer Gupta
My sense is the bigger one that we have been focused on is on the raw material piece, but we will have to see the impact of this cumulatively because we are spread across 30 states.
— Gunjan Shah
Now in terms of days and outstanding beyond what is the permissible credit terms, there is no risk from that perspective in the financials also, if you look at from a provision for doubtful debtors where we have a very strict policy, there is hardly any movement.
— Amit Aggarwal
On pre-Ind AS basis, the margin compression over the last 2, 3 years is around 200 bps plus.
— Prerna Jhunjhunwala
But on post-Ind AS -- on pre-Ind AS basis, the decline is sharper.
— Prerna Jhunjhunwala
But the decline seems to have got stayed now, and I can see that structurally happening.
— Gunjan Shah
Q&A — 7 exchanges
Q
First question is, sir, on inventory. So it has reduced steadily and it is -- so firstly, is it now at a level which is desirable or it's a continuous process and you will keep cutting down? And second question on this is that as you are reducing inventory, it also means fresher merchandise, lower discounting. But somehow this is not reflecting in our gross margin. So are we using a strategy wherein after a point, if it doesn't sell, we will just discount it and liquidate it. And this is something that is likely to continue? Or how is it playing out?
Gunjan Shah
Okay. Thanks, Sameer. Inventory, I think while I would say 70% or 75% of the job is done, we are wanting to get to turns which are in the range of about 3. We -- last I remember, I think our turns are, while I think very well comparable to our peers, but about at 2.7 or so, right? So there is some amount of improvement still left in our view. But however, it does not come at the cost of basically better availability, as I mentioned in my opening remarks, right? And I've been showing that consistently. So it's a very critical part of that project that availability actually should improve furthe
Q
Sir, my question would be with the competition increasing from both the domestic and global footwear brands, what do you see as the company's key structural advantage in sustaining market share and margins over the next 3 to 5 years?
Gunjan Shah
Okay. Good to hear you. Basically, the point is that there are around 3 or 4 pivots that we are basically focused on. And I've spoken about this. They are reasonably there in this piece that I consistently also update our progress on. Single largest piece that is there is basically on the product piece. right? There is a huge amount of investment that are going in. I think only 10% of that is what has come out into what is consumer facing, I would say. But over the next 12 months, there will be a massive amount of upliftment of product from a central product design perspective that we have inv
Q
So my question is the vendor revamp and the store revamp that Bata is doing, it's really helping the top line. How long could it take for these revamps to show effect on the bottom line?
Gunjan Shah
As you heard Amit comment on a previous question as well as in the opening remarks, we see underlying leverage coming through. And it's not just the store revamp, Malishka, but also the inventory pipeline decluttering and a combination of these initiatives. So we see underlying benefits coming through. And obviously, you will see that also in the ensuing periods as we push for much better top line, but with efficiency and therefore, leverage. All right. Understood. And my next question is that the 28% reduction in inventory is a great thing for the company. But the trade receivables have surge
Q
My first question is on profitability. On pre-Ind AS basis, the margin compression over the last 2, 3 years is around 200 bps plus. But on post-Ind AS -- on pre-Ind AS basis, the decline is sharper. So can you help us understand how do you see the operating leverage playing out even after opening the franchisee stores? And how do you view the efficiency of franchisee stores? What kind of levers are there to improve profitability?
Amit Aggarwal
Thanks for the question. See, right now, as I explained from a quarter-on-quarter perspective, at the PBT level, we were at about 11%. If I were to look at pre-Ind AS, which we also monitor from an internal perspective, our profit growth for the quarter was near about 16%. Now because of certain noncash items, that number has tapered down to what is the reported PBT growth, right, which I explained in the previous one. Structurally, again, if I were to look at from a channel perspective, franchise is an accretive channel at an overall level to Bata. So it is not a dilutive channel. It's a more
Q
In fact, I had the similar question in terms of the contribution from INR1,000, above and low. Apart from that, sir, if you could give us a sense on what was the current full year growth in case of Hush Puppies and the contribution from Hush Puppies?
Gunjan Shah
Okay. Kunal, first one, while I tried to tell Prerna that we'll get back offline, the accurate number, but broadly, just to give you a sense is that while this less than INR1,000 was declining for almost 3 years, I would say, since the GST went up, right, and the raw material price increases impacted consumers, we did see stabilization on that front. So now it's no longer declining. So it's kept pace. So it's in the ballpark of the overall 5% top line that we saw, right? So that's one. And that somehow answers even Prerna in a way. It was in the ballpark of about 35% to 40% contribution. It re
Q
Firstly, on the -- I just wanted to get this clarified. On the press release, you mentioned that Zero- Based Merchandising, which is at 550 stores, they are 70% of store sales. So just trying to get my reading right, this is basically out of the 1,150 COCO stores, 550 stores which have ZBM are contributing 70% of the store sales, which is roughly 50% of the store network. Is that a correct understanding?
Amit Aggarwal
Small clarification. That 70% contribution is coming from the 700 stores, which is also mentioned in the investor deck. So as at end of May '26, we already have ZBM stores rolled out across 700 stores. So these 700 doors is what is contributing to 70%. When we were at about 550 stores, the contribution was about 50% to 55%. Sir, then 70% of stores contributing 70% of sales, the turnover delta is not very high, right? I mean it's... Just to clarify, if you can just remove that because this is a key monitorable we monitor literally every week. The 550 stores out of 1,150, 70% contribution out of
Q
Yes. Thank you, everyone, for joining. It was lovely interacting. Good day to all of you. Thanks.
Management
Speaking time
Gunjan Shah
30
Sameer Gupta
13
Moderator
11
Amit Aggarwal
10
Kanishk Gupta
6
Prerna Jhunjhunwala
6
Malishka Velani
5
Nitin Bagaria
3
Kunal Bhatia
2
Angad Dhaliwal
1
Opening remarks
Angad Dhaliwal
Thank you. Good afternoon, everyone. On behalf of 360 ONE Capital, I would like to welcome you all for 4Q FY26 Conference Call of Bata India. On the management side, we have Mr. Gunjan Shah, MD and CEO; Mr. Amit Aggarwal, Director, Finance, CFO; and Mr. Nitin Bagaria, AVP, Company Secretary. Without taking much time, I would like to hand over the call to Mr. Nitin Bagaria for his opening remarks, post which we'll open the floor for the Q&A session. Over to you, sir.
Nitin Bagaria
Thank you and good evening, everyone, and welcome to the Q4 FY26 Earnings Conference of Bata India Limited. We have shared the presentation as a pre-read to the stock exchanges on Monday. I hope you had time to go through the same. We have also shared the disclaimer, which is part of the presentation. I now request Gunjan to take you through the performance summary. Thanks a lot.
Gunjan Shah
Thank you. Thanks, Nitin. Welcome to everyone on this call. Okay. So I will jump in. I will try and cover instead of going through the presentation, as Nitin mentioned, we have now started making sure that we've got enough time to upload the pre-read. So I will go through the Slide number 3 and restrict my summary comments to that. And obviously, the rest of the charts are there, and we are more than happy to cover that and anything else from the QA perspective. So, with that, coming in, I think pleased to have a second consecutive quarter of accelerating growth, and it was volume backed. It was also coming with significant growth in cash flow from operations. We saw growth across channels, right? So, it was broad-based and across our categories also. Coming to Slide number 3, retail, we saw volume-led DOS growth. We also saw expansion of ZBM. I've been talking of this agenda now for the last 1 year, right? And that has now shown scale up. We are now in the position to say that we are
Amit Aggarwal
So good evening, everyone. We had the second consecutive quarter of 5% plus growth. From a reported PBT perspective, while the reported number shows a decline of about 94%, by a couple of exceptional items, which we had clarified and informed. This was towards the closure of one of our manufacturing facilities. Historically, if you look at, we have been trying to improve the structural cost by closure of plant operations. And if you look at from the quarter perspective also, our employee cost is lower by about 10%. And this benefit is flowing from -- to the employee cost line item on a structural basis. The second large exceptional item for the quarter was the FX impact on one of our licensing agreement in line with the Ind AS. So the closing liability has to be translated at the closing exchange rate that led to an impact of about INR220 million, as mentioned in our notes. Third item, which is not mentioned, is a lower gains on account of lease closures. So last year, similar quarter,
Nitin Bagaria
Thank you, Amit. Gunjan, we now open the floor for Q&A. The moderator will help us, please. Thank you.
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