Geojit is bullish on Bata India has recommended buy rating on the stock with a target price of Rs 900 in its research report dated May 28, 2018.
Geojit's research report on Bata India
Bata India Ltd (BIL) is the largest retailer and leading manufacturer of footwear in India with ~1290 retail stores as on March 2018. BIL reported strong earnings growth of 45%YoY supported by 340bps improvement in EBITDA margins for Q4FY18 and revenue grew by 6.9%. Gross margin has been improving since Q1FY18 from 52.3% to 55.9% aided by premiumisation, lower rent and benefit from input tax credits.
BIL is currently trading at 36x 1yr fwd P/E (at 1Yr Avg). The healthy outlook on earning is expected to support valuations. We value BIL at 38x on FY20E EPS and revise upwards our target price to Rs.900 (Earlier Rs772) and recommend Buy.
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