Bajaj Auto Shares Rise 3%, Hit Fresh High on Healthy Q4 Growth Outlook

Bajaj Auto recorded its highest ever financial performance with a net profit of Rs 5,628 crore.

Shares of Bajaj Auto hit a new high of Rs 4,410.95 in intraday trade on Thursday, up 3% on the BSE, on healthy growth prospects. Shares of the country’s largest round 2/3 wheelers exporter have risen 16% in the past month. In comparison, the S&P BSE Sensex gained 5%.

For the January-March quarter (Q4FY23), Bajaj Auto’s Ebitda maintained its momentum, rising 26% YoY to Rs 1,718 crore, while the margin expanded by more than 220 basis points to 19.3%. The company said that price realisation and material costs were flat for several consecutive quarters, with a favourable mix driving the slight increase.

Operating income was Rs 8,905 crore, up 12% year-on-year, mainly driven by continued momentum in the domestic business, which delivered volume-led solid revenue growth (over 50% year-on-year). It added that better foreign exchange realisation, sensible pricing, and a wider product mix compared to last year’s period helped offset the overall lower volumes due to sluggish exports.

The company has proposed a dividend of Rs 140 per share for FY23 with a shareholding record date of June 30, 2023.

Management said retail sales in export markets have steadily improved with lower inventory levels as customers now accept higher prices. Furthermore, the company was able to maintain its market share in the export market due to the dominance of Pulsar 125 in the Latin market.

Brokerage ICICI Securities maintained its “hold” rating on Bajaj Auto.

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