Group MD of Bata India Rajeev Gopalakrishnan said that the company had shut almost 35 stores in this quarter, but it is likely to open bigger stores in same location, so its turnover is lower.
Footwear retailer Bata India's third quarter earnings came as mild disappointment for the market on operations and bottomline front. The Street was better numbers given the low base.
Citing reasons for the same, Group MD of Bata India Rajeev Gopalakrishnan said that the company had shut almost 35 stores in this quarter, but it is likely to open bigger stores in same location, so its turnover is lower. He further added that Bata is now focusing on like to like store growth and compared to previous year, the company has only opened 65 stores in this year so far.
“Last year the number of stores opened was almost 30 percent more. That is one of the reasons why you don’t see turnover growth as compared. But I still think it’s pretty good, 14 percent turnover growth is good,” he told CNBC-TV18.
Bata reported 17.29 percent increase in standalone net profit at Rs 37.59 crore for the third quarter ended September 20, 2013 against Rs 32.04 crore reported in the July- September quarter of last year. Its Q3 net sales stood at Rs 484.15 crore, up 14.31 percent compared with Rs 423.54 crore in the same quarter of its 2012 fiscal. (Read more)
Meanwhile, Gopalakrishnan remains confident about the company’s growth plan and adds that the company could have five-10 self-owned stores in FY15. “We are going to come out with destination stores. We are going to buy the land, build the property, come out with big stores and that is in process. We use our cash and cut our rentals. Since we have cash, we will use it to our advantage and come out with strong destination story,” he elaborated.
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