Bajaj Auto Ltd. share price target

However, at the CMP, the valuation appears full (stock is currently trading at 24.7x 12MF consensus P/E), and as a result, we maintain our HOLD rating on the stock.

BJAUT’s 1QFY25 performance was in line with our estimates. Margins remained stable QoQ, despite EV ramp-up, due to PLI accrual and favorable forex.

BJAUT reported a steady Q1 (revenue/EBITDA up 16%/24% YoY; 20.2%
EBITDA margin, aided by 50bps accrual of PLI benefit). Domestic 2W prospects
are healthy, though BJAUT’s position has slipped now (also in the 125cc
motorcycle); response to newly-launched CNG motorcycle needs to be watched.

BJAUT's Q1FY25 revenue jumped 16% YoY (4% QoQ) to Rs 119bn aided by volume growth of 7% and favourable mix aiding faster growth

Improved motorcycle sales mix and gross margin (+190 bps YoY) resulted in 4.8%/2.7% beat in EBITDA and APAT estimates.

We initiate coverage on Bajaj Auto Ltd. (BJAUT) with a “BUY” recommendation and a target price of Rs 11,160 based on SOTP valuation. We value the standalone business at 30x FY26E EPS of Rs 367.6 and add Rs 127 for the stake held in Pierer Mobility AG.