(Reuters) – Footwear maker Bata India posted a smaller-than-expected third-quarter profit on Monday, hurt by sluggish consumer demand amid high inflation.
The company’s quarterly consolidated profit grew 1.2% from a year ago to 587 million rupees ($6.71 million), but fell short of analysts’ estimate of 737 million rupees, according to data compiled by LSEG.
Bata, which also sells footwear brands such as Hush Puppies and North Star in India, said its revenue in the quarter rose 1.7% to 9.19 billion rupees, lower than the 9.59 billion rupees expected by analysts.
KEY CONTEXT
The company has posted weak earnings for the past few quarters as high inflation prompts customers to cut discretionary spending. It also battles increased competition from rivals such as Relaxo Footwears and Metro Brands.
Relaxo’s third-quarter profit fell 14%, hurt by weak consumer demand, while Campus Activewear is expected to post results on Tuesday.
PEER COMPARISON
Valuation (next Estimates (next 12 Analysts’ sentiment
12 months) months)
RIC PE EV/EBIT Revenue profit Mean # of Stock to price Div yield
DA growth(%) growth(%) rating* analysts target** (%)
Bata India Ltd 49.36 19.58 9.84 15.93 HOLD 9 0.95 1.42
Metro Brands Ltd 74.63 38.46 16.16 26.06 BUY 20 0.97 0.36
Relaxo Footwears Ltd 61.27 29.51 8.19 19.41 HOLD 9 0.83 0.56
Campus Activewear Ltd 53.44 28.41 14.07 28.85 BUY 8 0.89 NULL
* Mean of analysts’ ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell ** Ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
OCTOBER-DECEMBER STOCK PERFORMANCE
— All data from LSEG
— ($1 = 87.4390 Indian rupees)
(Reporting by Aleef Jahan; Editing by Sahal Muhammed)
