Shares of Bata India Ltd hit a fresh 52-week low amid negative sentiment in the broader market today. The footwear stock hit an intraday low of Rs 1382.95, down 2.72 per cent today. Later, the stock closed 2.05% lower at Rs 1392.50 on BSE. The share has lost 23.67 per cent in a year and fallen 15.64 per cent in 2023. A total of 0.59 lakh shares of the firm changed hands, amounting to a turnover of Rs 8.20 crore.
The market cap of the firm fell to Rs 17,897 crore on the BSE.The share hit a 52-week high of Rs 2,040 on April 5, 2022.
In terms of technicals, the relative strength index (RSI) of Bata India stands at 28.1, signaling it’s trading in the oversold territory. Bata India stock has a one-year beta of 0.9, indicating low volatility during the period. Shares of Bata India are trading lower than the 5-day, 20-day, 50-day, 100-day, and 200-day moving averages.
The firm announced a 15 per cent rise in consolidated net profit at Rs 83.19 crore in the third quarter ended December 2022 against net profit of Rs 72.32 crore in the corresponding period of last fiscal. Consolidated revenue from operations in Q3 rose 7% to Rs 900.21 crore as compared to Rs 841.3 crore in the year-ago period.
Total expenses rose to Rs 798.04 crore up from Rs 757.6 crore in the same period a year ago.
Commenting on the prospects of the Bata India stock, Abhijeet from Tips2trade said, “A slowdown in the Indian economy caused by higher inflation has massively hit margins of majority of the companies including Bata India. Currently, Rs 1,418 is a strong resistance and if the stock price doesn’t breach this level in closing basis this week, we can see lower level of Rs 1338 soon.”
ICICI direct in a report dated February 16 assigned a target price of Rs 1640, up 13% from then market price of Rs 1450.
“Bata, in the last five years, has delivered 16% CAGR returns. Focus on cost reduction, omni channel, product mix change (higher share of casual footwear) and calibrated expansion of retail network through franchisee route can be structurally positive. However, new initiatives are taking longer to deliver material improvement in performance in a tough macro and competitive environment. Hence, growth could be constrained in near to medium term. We change our rating on the stock from BUY to HOLD and value Bata at Rs 1640 i.e. 50x FY24E EPS,” said the brokerage.
Motilal Oswal assigned a neutral rating to Bata India stock after Q3 earnings. It gave a target price of Rs 1,690, 14% higher than the market price at that time.
“The slower recovery from Covid, demand pressures within the mass segment on account of inflation and GST hike continue to remain a drag. However, moderating RM prices and improved ASPs led by premiumization could be the key growth catalysts. We cut our FY24E PAT by 11%, factoring in a revenue/ PAT CAGR of 12%/34% over FY23-25. Retain Neutral with a target price of Rs 1,690,” said the financial services firm.
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