Sharekhan has given Buy recommendation for Bata India with a target price of Rs. 2370 in its research report issued on Nov 03, 2021
Sharekhan’s research report on Bata India
Bata India (Bata) posted a strong recovery in Q2FY2022 with business recovering to 95% of pre-COVID levels. Revenues stood at Rs. 614 crore (grew by 67% y-o-y), while strong cost-saving initiatives aided a strong improvement in OPM to 19.4%. Bata continued its retail expansion drive by opening more than 30 stores through franchisee route taking overall tally to over 270 stores. The company enhanced its portfolio in casual footwear across categories led by Floatz and a renewed range of North Star footwear. Post easing of lockdown, Bata saw growth in footfalls in its stores. Improved mobility in the coming quarter augurs well for a faster recovery.
We maintain Buy with a revised PT of Rs. 2,370. The stock is currently trading at 55.8x/47.9x its FY2023E/24E EPS and 24.3x/20.8x its FY2023E/24E EV/EBIDTA.