BATA India - Educational Notes

About the company

BIL is a 53% subsidiary of Bata (BN) BV, Amsterdam – a BSO Group company. BIL is one of the largest footwear manufacturers in India and sells a wide range of footwear in canvas, rubber, leather, and plastic. The company has four manufacturing units at Batanagar (Kolkata), Bataganj (Bihar), Peenya (near Bangalore), and Hosur (Tamil Nadu). BIL at present sells footwear under the Bata brand through more than 1,763 retail outlets across India and a large number of other outlets, served by various Bata dealers

Conclusion

Bata India is a debt free company with healthy profitability ratio and healthy operating profit margins with increasing cash flow from operations. Bata India as such is a good stock to own in portfolio but had been on higher side of valuation. If someone is keen to add this stock then way to go about of to add on Dips.

Strengths

• Strong financial risk profile characterised by nil debt, strong liquidity position and robust debt coverage indicator
• Healthy operational profile with strong brand equity and established distribution network
• Technical support from Bata Group

Challenges

• Adverse impact of COVID-19
• Increase in competition
• Volatility in raw material prices may put pressure on profitability

Pros

• Company has been maintaining a healthy dividend payout of 21.12%
• Rising Trends of Cash Flow
• Increasing EBITDA Margins 

Cons

• Stock is trading at 8.58 times its book value
• To The company has delivered a poor growth of 2.55% over past five years.

Trends

Key Ratios 

Performance Metrics 

Peer Comparison 

Happy Investing 

ViRu

Disclaimer 

I am not SEBI registered analyst Above Educational Note is for further study only 

Source 

Screener.in

Credit Rating Report by ICRA