Bajaj Auto Limited is an Indian multinational automotive manufacturing company based in Pune. The company manufactures motorcycles, scooters and auto rickshaws. Bajaj Auto is a part of the Bajaj Group. It was founded by Jamnalal Bajaj in Rajasthan during the 1940s.
Bajaj Auto is the world’s third-largest manufacturer of motorcycles and the second-largest in India. It is the world’s largest three-wheeler manufacturer. In December 2020, Bajaj Auto crossed a market capitalisation of ₹1 trillion (US$13 billion), making it the world’s most valuable two-wheeler company.
The company exports to 79 countries across several continents to Latin America, Southeast Asia, etc. The company has acquired 48% of the KTM Brand which manufactures sports and super sports two-wheelers.
Quarterly Earnings Walkthrough
Bajaj Auto registered their consolidated net sales at Rs 9,319 crore in December 2022 which is up marginally by 3% from Rs. 9,022 crore which was registered in December 2021.
The company’s consolidated quarterly net profit was reported at Rs 1,473 crore in December 2022 which is up by a mere 3% from Rs 1,423 crore which was reported in December 2021.
The EBITDA was computed at Rs 2,028 crore in December 2022 which has risen up by 18% from Rs 1,719 crore which had been computed in December 2021.
Notable Highlights
The company reported a 17 percent year-on-year decline in its volumes, mainly because of the macroeconomic challenges which are being faced by the export markets.
The two-wheeler industry had been facing the problems of subdued demand environment and supply-chain disruptions because of the shortage of semiconductor chips. However, the industry has overcome these challenges as the management has indicated that supply-side constraints have become smooth significantly as new sources have been initiated.
The company also stated that economic hardship post the pandemic and the significant price rise, due to safety norms and pass-through of raw material costs, have dampened the demand sentiments.
The company has highlighted that the order book continues to be very strong.
Considering the electric vehicle (EV) segment, the company has commissioned a new state-of-the-art plant, which will help Bajaj Auto to capitalise on the opportunities which are offered in the EVs segment.
Bajaj Auto share price has peaked at the 161.8% retracement level thrice and failed to make a break over the level. This indicates a strong operator presence at the levels of Rs 4200 to Rs 4000. The price is very close and above the 200-day moving average and the MFI is at 51 points. Long-term investors may accumulate this stock as the next target of the 261.8% retracement level is at Rs 5785. A break above the 261.8% retracement level is crucial for the long-term target.
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