Bajaj Auto Ltd. share price target

We maintain Buy rating on Bajaj Auto (Bajaj) with unchanged PT of Rs 3,500. Demand is improving in both domestic as well as export markets. Q2FY21 operating results were ahead of estimates as margins improved on a y-o-y basis...

Seminal year for industry provides interesting insights However, amid all the gloom, the engineering and production prowess of the industry (along with its value chain) shone brightly as it successfully completed the world's fastest switchover to Euro 6 equivalent emission norms i.e. BS-VI as per schedule. Much of the post festive period was focused on the transition, with the entire ecosystem estimated to have spent ~| 70,000 crore towards the technological leap. Covid-19 crisis struck India in the run up to April 2020, just as the changeover...

We upgrade our rating from HOLD to BUY with a Target Price of Rs 3,300 (earlier 2,850) valuing it at 16x (earlier 17x) FY23E PE ratio (including Rs 120/share for its stake in KTM) which gives an upside of ~8% from current levels.

Bajaj Auto is the world's sixth-largest manufacturer of motorcycles and the second-largest in India. It is also the world's largest three-wheeler manufacturer. The company is based in Pune, Mumbai with plants in Chakan (Pune), Waluj (near Aurangabad) and Pantnagar in Uttarakhand. Bajaj Auto...

Numbers bottomed out in Q1, heading towards recovery Resilience displayed in pandemic hit quarter Bajaj Auto posted a 61% yoy decline in the topline in COVID hit Q1, while they declined by 55% qoq. The volumes fell by 64.5% yoy and 55% qoq as there was a stringent lockdown observed in the earlier part of the quarter. Realizations grew by 9.8% yoy, which were very well supported by export realizations and a higher proportion of BS 6 vehicles. EBITDA declined by 66% yoy to 4.1 bn, while margins still showed a better performance at 13.3%, much better than street's expectations, though it was lower by 210 bps yoy. The overall underperformane stemming from...

Bajaj Auto reported a dismalQ1FY21 but along expected lines. Revenue declinedby ~60% YoY at Rs3079cr (v/s our est. of Rs 3078 cr). EBITDA came in at Rs409cr ahead of our estimates on better Gross Margins (up 460 bps YoY). EBITDA margin was at 13.3% (down ~220 bps YoY and 510 bps QoQ)

Bajaj Auto (BJAUT) Q1FY21 result was above our and consensus estimates at all parameters. EBITDA margin for the quarter stood at 13.3% vs our and consensus estimates of 4.4% and 10.6% respectively on account of lower operating expenses. We expect domestic 2W/3W industry to see a double digit decline in FY21 driven primarily by adverse impact of the COVID-19 outbreak on economic growth and discretionary spending. However stronger recovery in export market for 2W/3W segment would help BJAUT to partially mitigate the current slowdown in domestic market. We cut our volume estimates for FY21/FY22 by 5% each factoring the extended lockdown in certain...

Finacing concerns for domestic 3Ws to continue as owners are only earning ~30-40% of the normal business per days. No conern on 2W so-far. BJAUT results were operationally better with positive surprise on EBITDA margins at 13.3% (-220bp YoY, PLe 12.5%) led by three year high gross margins at 32.9% (+470bp YoY, PLe 32%). The beat was led by favorable forex impact. However, Adj.PAT came in lower at Rs5.3b (-53% YoY, PLe Rs6.2b) due to lower other income. With weak product mix (higher domestic share)...

Bajaj Auto Q4 results, net profit flat at Rs 1,310 crore; still beats Street estimates. Bajaj Auto posted 0.36 per cent year-on-year (YoY) rise in consolidated net profit at Rs 1,310.29 crore for the quarter ended March 31. Bajaj Auto had reported a net profit of Rs 1,305.59 crore in the corresponding quarter last year. It's quarterly profit remained largely flat as exports partially offset its sales decline in India after the coronavirus pandemic stalled operations and dealt another blow an already struggling automobile sector....

Bajaj Auto (BJAUT) Q4FY20 result was above our and consensus estimates at operating level. EBITDA margin for the quarter stood at 18.4% vs our and consensus estimates of 16.3% and 15.8% respectively. We expect 2W industry to see a double digit decline in FY21 driven primarily by adverse impact of the COVID-19 outbreak on economic growth and discretionary spending. The challenges for the 2W segment are likely to get aggravated as consumer spending will be severely impacted by the outbreak resulting in lower spending power both in urban and rural markets. We believe BJAUT being a major player in 250cc segment could see muted sales for Pulser/Avenger/KTM etc. We...