BAT -1.05% in 24 Hours Amid Bangladesh Sales Slump and Operational Challenges

British American Tobacco (BAT) experienced a 1.05% decline in 24-hour trading on NOV 2 2025, reaching $0.1891. Over the past week, the stock advanced by 13.71%, and over the last month, it climbed 16.58%. However, over the past year, BAT lost 18.77% of its value, reflecting ongoing pressure from regional challenges and operational costs.

The performance of BAT appears to be influenced by recent reports from its Bangladesh operations, where the company posted a 23% year-on-year drop in quarterly profits. The decline was primarily driven by a sharp reduction in sales volume and elevated operational costs, including excise duties and costs associated with relocating its Dhaka factory to Ashulia in July 2024. The company's Q3 net sales fell by 18% year-on-year to Tk 16.77 billion, and its nine-month performance showed a 46% year-on-year drop in profits. Local sales in Bangladesh declined by 20%, while leaf exports increased by 78% to Tk 3.70 billion.

The relocation of BAT Bangladesh's operations led to one-off costs of Tk 2.12 billion and a 15% increase in operating expenses. Finance costs and excise duties also rose by 21% and 14%, respectively, further squeezing the bottom line. Additionally, BAT reported a negative net operating cash flow per share for the January-September period, shifting from a positive Tk 26.17 to negative Tk 21.70 per share.

These operational strains have contributed to the recent volatility in BAT's share price. Despite a 300% increase in cash dividends for 2024, the company's ability to maintain profitability and operational cash flow has been challenged by high fixed costs and declining domestic demand in Bangladesh. The situation has also impacted the company's asset value, with the net asset value per share declining from Tk 113.82 to Tk 105.22.

The company's technical performance is closely monitored for potential rebounds. Analysts have not made specific projections for BAT’s near-term price movement, but the recent 13.71% weekly gain and 16.58% monthly increase suggest some short-term volatility may be unwinding. However, the year-on-year decline underscores the longer-term challenges the company faces.

Backtest Hypothesis
A backtesting strategy could be developed based on BAT’s historical performance and key technical indicators such as moving averages and relative strength index (RSI) to determine potential entry and exit points for investors. The strategy would aim to identify periods of oversold or overbought conditions and use them to predict price reversals. By analyzing the stock’s behavior during similar market conditions in the past, the backtest would assess the viability of trading signals generated by these indicators. The effectiveness of the strategy would be evaluated using performance metrics such as annualized return, drawdown, and Sharpe ratio.