Bata India Ltd — Q1 FY27 earnings call
Summary generated by AI from the official transcript Bata India Ltd filed with BSE on 17 Aug 2026. Every statement cites a verbatim quote from that document — open any citation to read it. This is a record of what management said, not a recommendation. How we check these summaries
The short read
Bata India reported Q1 FY27 revenue of Rs 979 crore, a 4% growth split evenly between volume and value, with underlying PBT growth of about 22%. The company crossed 2,000 EBO stores, expanded its ZBM program to about 775 revenue-contributing COCO stores, and increased ad spend by 25% year-on-year. Management attributed gross margin movement of 130 basis points partly to channel mix dilution, and discussed raw material cost inflation of 5% to 6% that has been offset through price increases.
Numbers mentioned
Revenue: INR979 crores (Q1 FY27)
p. 3
“We recorded obviously INR979 crores, right, of turnover, which was about a 4% growth and backed by volume growth, which was also both volume and value equally split, price growth.”
Gunjan Shah, page 3 of the filed PDF · View the filing
Underlying PBT growth: about 22% (Q1 FY27)
p. 3
“The underlying PBT growth, as we have mentioned in the press release, was at about 22% as well, as substantiated by a table in the presentation.”
Gunjan Shah, page 3 of the filed PDF · View the filing
EBO store count: 2,000 stores
p. 3
“We also crossed the landmark of 2,000 EBO stores, the first obviously, brand or a banner in the country to cross 2,000.”
Gunjan Shah, page 3 of the filed PDF · View the filing
Ad spend growth: about 25% (Q1 FY27)
p. 3
“The ad spend was up by about 25%.”
Gunjan Shah, page 3 of the filed PDF · View the filing
Stock turns: about 2.5 plus
p. 3
“Stock turns are at industry best at about 2.5 plus.”
Gunjan Shah, page 3 of the filed PDF · View the filing
Full-price sales: close to 90% (Q1 FY27)
p. 3
“Our full-price sales were very close to 90%, with a continuous uptick over the last 4 or 5 quarters.”
Gunjan Shah, page 3 of the filed PDF · View the filing
Google My Business score: almost 4.9 (Q1 FY27)
p. 4
“This was also backed by a very strong upshift in the Google My Business scores of our stores, which is like an external, outside-in NPS, now standing at almost 4.9 for the quarter.”
Gunjan Shah, page 4 of the filed PDF · View the filing
Franchise store count: 750
p. 3
“Franchise expanded to 750.”
Gunjan Shah, page 3 of the filed PDF · View the filing
Cost push from raw materials: 5% to 6%
p. 4
“So broadly, the cost push what we have witnessed is in the range of about 5% to 6%.”
Amit Aggarwal, page 4 of the filed PDF · View the filing
Channel mix dilution on gross margin: close to 100 basis points (Q1 FY27)
p. 6
“Just to add on what Gunjan mentioned for the current quarter, the channel mix dilution is close to 100 basis points.”
Amit Aggarwal, page 6 of the filed PDF · View the filing
Gross margin improvement (reported): 130 basis points (Q1 FY27)
p. 6
“So if assuming the same channel mix would have been there, the gross margin percent would have seen an improvement of 230 basis points versus 130 basis points what you see.”
Amit Aggarwal, page 6 of the filed PDF · View the filing
Average lines per store index: 68%
p. 9
“So we are now at 68% of average lines per store compared to what we were 2 years back, right, as the graph shows.”
Gunjan Shah, page 9 of the filed PDF · View the filing
Franchise partner ROI: 18% to 24%
p. 11
“Broadly, a franchise partner gets in the range of about 18% to 24% ROI.”
Gunjan Shah, page 11 of the filed PDF · View the filing
Contract manufacturing partners: below 70, close to 60
p. 11
“Now we are down to below 70, I think close to 60 or so.”
Gunjan Shah, page 11 of the filed PDF · View the filing
A&P expense as percentage of sales: 3% to 3.5% (current trend)
p. 12
“Right now, you can look at whatever is the current trend line, which would be about between 3%, 3.5% versus about 2.5% a year back.”
Amit Aggarwal, page 12 of the filed PDF · View the filing
What management said it would do
A record of statements made on the call, in the words management used. Parakho does not forecast, endorse or assess them, and their presence here is not a view on whether they will happen.
EBO store count target — 3,000
stated as an aspiration by Gunjan Shah
p. 3
“We now obviously have desire to move towards 3,000 in the coming future.”
Gunjan Shah, page 3 of the filed PDF · View the filing
Cost push impact on margin — no margin dilution from cost push · subsequent quarter
stated conditionally by Amit Aggarwal
p. 4
“But as I said, with the cost push, we have also corrected the pricing. So, largely, we expect that even in the subsequent quarter, we should not have margin dilution on account of cost push.”
Amit Aggarwal, page 4 of the filed PDF · View the filing
Product portfolio transformation — significant change in product portfolio · by March '27
stated as an aspiration by Gunjan Shah
p. 6
“So by March '27, you should see a significant change in the portfolio of products we are offering to consumers, right, with, as I mentioned, a significant amount of authority from Bata on design and comfort, backed by technology.”
Gunjan Shah, page 6 of the filed PDF · View the filing
Average lines per store index — around 60%
stated as an aspiration by Gunjan Shah
p. 9
“My sense is that this will settle somewhere around 60%.”
Gunjan Shah, page 9 of the filed PDF · View the filing
Marketing spend — elevated marketing spends · next couple of years
stated firmly by Gunjan Shah
p. 10
“And I don't see a reason why the next period that is coming ahead, I wouldn't say only the quarters, but even the next couple of years, you will see elevated marketing spends to back up this -- the product range that is coming.”
Gunjan Shah, page 10 of the filed PDF · View the filing
Core manufacturing partner consolidation — 15 core plus 15 satellite, about 30 total · 3 to 5 years
stated as an aspiration by Gunjan Shah
p. 11
“We should foresee as we had shared that we should have 15 core as well as a satellite set of another 15, so about 30 broadly in the next about 5-year journey -- 3 years to 5 years journey.”
Gunjan Shah, page 11 of the filed PDF · View the filing
Margin expansion from consolidation and rationalization — about 200 basis points · multi-year journey
stated as an aspiration by Gunjan Shah
p. 12
“So all this clocked together over this journey period, right, which is spanning across multiple years, should give us about 200 basis points thereabouts.”
Gunjan Shah, page 12 of the filed PDF · View the filing
Savings from vendor consolidation — 0.2% to 0.3% year-on-year · longer period of time
stated as an aspiration by Amit Aggarwal
p. 11
“But yes, typically, we have witnessed over a longer period of time, we should have got a delta savings from consolidation at an overall level of about 0.2% to 0.3% at a year-on-year basis, right?”
Amit Aggarwal, page 11 of the filed PDF · View the filing
Q&A highlights
Management's answers to analyst questions, in Parakho's words rather than a transcript. Each row names who answered and carries the verbatim quote it was drawn from.
Management said raw material cost push of 5-6% has been offset with commensurate price increases, though the impact will be more visible from the current quarter due to inventory holding.
Answered by Amit Aggarwal
Asked by Prerna Jhunjhunwala: How is Bata mitigating the cost inflation faced this quarter?
p. 4
“In the existing quarter, the cost push was not witnessed given that we hold inventory greater than, let's say, about 140, 150 days. So the impact of cost push would be more visible from the current quarter.”
Amit Aggarwal, page 4 of the filed PDF · View the filing
Hush Puppies and Floatz led growth, Bata grew well led by the ladies category, Power did well in sneakers while NorthStar lagged due to conscious rationalisation.
Answered by Gunjan Shah
Asked by Prerna Jhunjhunwala: How have different brands like Hush Puppies, Power performed?
p. 5
“Sneakers: Power did well, but NorthStar was a drag. Some of it was also done consciously, as we are rationalising our current lines in NorthStar to come back with a much stronger collection that you will see coming through over the next couple of quarters.”
Gunjan Shah, page 5 of the filed PDF · View the filing
Management explained that channel mix, particularly faster franchise growth, dilutes gross margin even though it is EBITDA accretive.
Answered by Gunjan Shah
Asked by Avinash Karumanchi: Why hasn't the improvement in full-price sales translated into better gross margins?
p. 6
“While at an EBITDA level, it is obviously neutralised and it's much more accretive. But at a gross margin level, it is dilutive. So it's not apple-to-apple comparison that you might be looking at.”
Gunjan Shah, page 6 of the filed PDF · View the filing
Management attributed it to VRS impact and organisational restructuring driving productivity, partly offset by increased manpower investment in the fast-growing franchise channel.
Answered by Gunjan Shah
Asked by Sameer Gupta: Why have employee costs remained flat for five quarters?
p. 8
“But the VRS did have an impact on employee cost, and that's one of the objectives in the business case for the VRS.”
Gunjan Shah, page 8 of the filed PDF · View the filing
Management said the largest lever this quarter was improved inventory quality leading to lower markdowns, with consolidation savings still to be realized over time.
Answered by Amit Aggarwal
Asked by Aryan Garodia: How much of the 130 bps gross margin expansion came from vendor consolidation versus premiumization?
p. 11
“As you rightly said, for the current quarter, one of the largest lever of the margin expansion is the quality of inventory what we are holding on.”
Amit Aggarwal, page 11 of the filed PDF · View the filing
Management gave no specific timeline, saying only that they expect it as soon as possible.
Answered by Gunjan Shah
Asked by Aryan Garodia: What is the expected timeline for the increased ad spend to translate into double-digit top-line growth?
p. 12
“As early as possible is our expectation.”
Gunjan Shah, page 12 of the filed PDF · View the filing
Risks flagged
Elevated raw material prices for imported synthetics tied to crude oil derivatives
p. 4
“There are obviously elevated raw material prices, largely for synthetics being imported, which are crude oil derivatives.”
Gunjan Shah, page 4 of the filed PDF · View the filing
Deferral of revenue due to delayed monsoon
p. 5
“We -- in the short term, we did see some deferral of revenue last quarter due to the delay in the monsoon.”
Gunjan Shah, page 5 of the filed PDF · View the filing
Uncertainty over industry-wide impact of inflation and price increases
p. 5
“We'll obviously have to wait and watch the impact of inflation and price increases that I think the whole market will have to undergo.”
Gunjan Shah, page 5 of the filed PDF · View the filing
NorthStar sneaker line underperformance
p. 5
“Sneakers: Power did well, but NorthStar was a drag.”
Gunjan Shah, page 5 of the filed PDF · View the filing
Channel mix shift toward franchise and e-commerce diluting gross margin
p. 7
“Last but not least, this might get mitigated a little by the channel mix, assuming the franchise channel will keep growing faster, and the e-commerce channel will keep growing faster, while the cost lines are very different from DOS.”
Gunjan Shah, page 7 of the filed PDF · View the filing
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