Re-iterate BUY as (1) Industry demand trends are improving after several quarters of decline (2) Bajaj is well prepared for BSVI due to its tie up with KTM. Further, 3W/exports are ~50% of volumes which provides cushion against volatility in domestic 2Ws. (3) Co will launch new premium brands in India including the Husqvarna and Triumph (agreement is expected to be finalized shortly). Bajajs 2QFY20 PAT (Rs 14bn, +22% YoY) was ahead of estimates as operating margins surprised at 16.6% (+110bp QoQ) & lower tax rates aided profitability. Reiterate Bajaj as preferred pick in the sector. Maintain BUY with a revised TP of Rs 3,530 (@ 18x Sep-21E EPS).