Bata India Ltd’s performance in the September quarter (Q2FY26) disappointed investors, dragging its shares down 4% on Tuesday as the results fell short on multiple fronts. The footwear company struggled with growth throughout the quarter, and with costs remaining elevated, it failed to meet expectations across key metrics.
Revenue declined 4% year-on-year to ₹801 crore, marking the weakest showing in the last ten quarters, compared with estimates of around ₹860 crore by JM Financial Institutional Securities and Motilal Oswal Financial Services. Bata cited early transmission of GST benefits to consumers, aimed at clearing inventory ahead of official rate cuts, as one factor. Deferred purchases from channel partners and consumers following GST rationalization, along with a temporary disruption at a key warehouse in July, also weighed on sales.
Profitability was under pressure as well. Gross margin slipped 122 bps to 55.4%, impacted by higher pre-festive markdowns and increased marketing spend. Ebitda margin fell 277 bps to 18.1%, below forecasts of 22–24%, leading to a 17% decline in Ebitda to ₹145 crore. Staff costs rose moderately by 30 bps.
Signs of recovery are emerging as sales momentum improved after the new GST rates came into effect on 22 September. Premium brands like Hush Puppies and Power are performing well, and Bata’s zero-base merchandising initiative has expanded to 200 stores, offering hope for growth revival amid rising competition.
Bata’s stock has slid roughly 20% in 2025.