Footwear major Bata India on Wednesday reported a 27.8% dip in its net profit during the January-March quarter of FY25 to Rs 45.9 crore, due to soft demand and slightly higher expenses.
During the same quarter in FY24, the company had reported a net profit of Rs 63.6 crore.
The company’s revenue from operations fell 1.2% to Rs 788.2 crore during the quarter, as compared to Rs 797.8 crore a year ago.
On the other hand, the expenses rose 1.5% to Rs 748.3 crore as compared to Rs 736.8 crore earlier.
Despite a fall in revenue amid difficult demand conditions, the company said it witnessed an increase in volumes for the second consecutive quarter, led by franchise and e-commerce channels.
Bata India has been undertaking a zero-based merchandising approach in some of its stores. From 17 in the previous quarter, the number of such stores has now gone up to 146 stores.
Under this approach, the expenses and merchandise are based on current need and not historical patterns. In every budgeted period, the calculation starts from zero.
The company said it is witnessing an improvement in revenue per square foot due to this approach.
“Along with cautious control on costs and focus on efficiency and productivity, we continued to manage our inventory while having strong deployment of fresh merchandise in anticipation of demand revival and consumption uptick,” said Gunjan Shah, MD and CEO of Bata India.
The company has also been expanding its store network. During the quarter, it added 19 franchise stores, taking the total number of stores to 1,962 (including company-owned company company-operated stores).
The company also entered the quick commerce space in December last year.
Bata has also been focusing on offering newer and more affordable stock keeping units (SKU). Moreover, it has taken inventory tightening measures, which have reduced aged and outdated inventory.
“We continue to drive affordability and reducing complexity across categories,” Shah said.
“Our initiatives on inventory, merchandising and decluttering worked well and all key inventory metrices improved.”
The company’s board also recommended a final dividend of Rs 9 per share. In September, it had paid an interim dividend of Rs 10.