BATAINDIA - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

🧠 How I’m Thinking About This

You’re asking for a full-spectrum fundamental analysis of Bata India Ltd (BATAINDIA), a legacy brand in the footwear industry. I’m evaluating its financial strength, valuation metrics, business model, and technical indicators to determine its long-term investment potential and ideal entry point.

📊 Core Financials Breakdown

Profitability & Growth

EPS: ₹16.0 — modest for its market cap

PAT Qtr: ₹54.9 Cr vs ₹43.6 Cr — sequential growth, but YoY profit down sharply (~70%)

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ROE: 15.6%, ROCE: 15.2% — decent returns, but not exceptional

Qtr Profit Var: -20.7% — signals margin pressure or muted demand

Balance Sheet Strength

Debt-to-equity: 0.92 — manageable, but higher than ideal for a consumer brand

Book Value: ₹122 — price-to-book ratio ~10.2, indicates premium valuation

Dividend Yield: 1.53% — moderate, consistent payout

💰 Valuation Indicators

Metric Value Interpretation

P/E Ratio 74.0 Highly overvalued vs industry PE of 49.5

P/B Ratio ~10.2 Significant premium to book value

PEG Ratio 2.18 Overvalued relative to earnings growth

Intrinsic Value ~₹1,100–₹1,150 Trading above fair value

Valuation is stretched, especially with recent earnings volatility and a high PEG ratio.

👟 Business Model & Competitive Edge

Industry: Footwear — consumer cyclical, brand-driven

Moat: Strong brand recall, wide retail footprint, diversified product range

Challenges

Rising competition from domestic brands (e.g., Relaxo, RedTape)

Margin pressure due to input costs and muted demand

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Institutional sentiment weakening (FII & DII holdings down)

Despite its brand strength, Bata is facing headwinds in profitability and valuation.

📉 Technical & Entry Zone

Current Price: ₹1,246

DMA 50/200: Trading near both — neutral trend

MACD: +27.9 — bullish momentum

RSI: 60.2 — neutral to slightly bullish

📌 Suggested Entry Zone: ₹1,150–₹1,180

This range offers a better margin of safety and aligns with technical support levels

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🕰️ Long-Term Holding Guidance

Hold if already invested, but monitor earnings and margin trends

Buy on dips near ₹1,160 if bullish on brand strength and retail recovery

2026 Target Price: ₹1,300–₹1,325 based on projected recovery and retail expansion

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⭐ Fundamental Rating

3.6

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stockanalysis.com

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stockpricearchive.com

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