India is the second largest footwear manufacturer in the
world with 9% of the annual global production of 22 billion pairs. Presently about 90% of the footwear produced in India is consumed by the domestic market and the rest is exported.
India’s consumption stands at ~2.1 billion pairs and is third largest globally after China and USA. With the focus of Government on manufacturing sector, the future potential of the footwear industry is promising, particularly for established and organized brands.
In Which stock an investor should invest – BATA or RELAXO ?
Bata generally deals in premium products whereas Relaxo deals in mass appeal products. Bata generally focuses on margin whereas Relaxo focuses on volume.
This year Bata sold 4.93 crore pairs at a price of Rs 620 per pair making a profit of around Rs 66 per pair. On the other hand Relaxo sold 17.92 crore pairs at a price of Rs 135 per pair making a profit of Rs 13 per pair.
The key financial ratio has been provided hereunder-
Government has hiked import duty on footwear
from 25 per cent to 35 per cent and on footwear components from 15 per cent to 20 per cent. This move, combined with recent government announcements on promoting ‘Made-in-India’ footwear, is expected to provide a boost to domestic Mfr.
Disclaimer: I have no vested interest in any of these stocks and all the calculations are done according to their annual reports

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