Womens footwear: This segment currently accounts for 20-25% of the companys revenues and would be one of the key growth drivers in future. The management is aware of the challenges in terms of higher competition and frequent fashion changes which would require them to be much more agile; however, it believes mid-priced womens shoes is a virtually non-existent category and the company has all the right kind of brands to leverage this opportunity.
Footin: The companys primary aim in this segment is to give a shoe to the consumer which is of good quality and yet economical so that it can be changed every 3-4 months.
Hush Puppies: The exclusive Hush Puppies store count is set to double over the next year or so. This is one segment where management seems to be fairly confident of future growth and also believes that it would be the primary driver of premiumisation for Bata.
Accessories: Now account for 7% of the total revenues and the companys target is to take it to 10% by end 2014.
Margins: According to management, while the company has done well as far as profitability is concerned in the last few years, it is yet not satisfied and will continue to strive hard.
We continue to hold buy rating with target price of Rs 1,090.