Despite Bata India Ltd’s announcement of a significant 38 percent decrease in its net profit for the second quarter of FY24, the company’s shares experienced a notable surge of nearly 2.5 percent in early trade on November 9. The company reported a consolidated net profit of Rs 34 crore for the September quarter, a decline from Rs 54.8 crore in the previous year. Despite this decline, the market response was unexpectedly positive.
At 9:33 am, Bata India’s stock was trading at ₹1,595.35 on the National Stock Exchange (NSE), indicating a 2.47 percent increase. The company’s revenue for the quarter stood at Rs 819 crore, reflecting a marginal 1.3 percent decrease from Rs 829.7 crore in the year-ago quarter, as stated in a regulatory filing.
Interestingly, Bata India witnessed a significant boost in its Earnings before interest, tax, depreciation, and amortization (EBIDTA) which rose to Rs 181.6 crore, marking a substantial increase of 12.9 percent. The EBIDTA margin also showed improvement, reaching 22.2 percent and rising by 280 basis points YoY, indicating the company’s strong operational performance despite the decline in net profit. One basis point is equivalent to one-hundredth of a percentage point. The market’s positive response to Bata India’s stock suggests confidence in the company’s ability to navigate challenges and maintain operational efficiency.
