Bajaj Auto Q2 Results Review - Valuations Capped, Downgrade To Neutral: Yes Securities

Yes Securities Report

Bajaj Auto Ltd.’s Q2 FY25 reported Ebitda was a marginal miss at Rs 26.5 billion (estimate Rs 27.8 billion) led by lower-than-expected gross margins. Ebitda margins were flat QoQ at 20.2% (+40bp YoY) led by;

1. weak gross margins at 28.7% (estimate 29.6%, -130 bp YoY) due to ~30 bp/100 bp impact due to raw material inflation/Chetak ramp-up and

2. higher other (+18% YoY) due to increased marketing spends and accounting for royalty as Triumph has been scaled-up.

We continue to believe, margins likely to be range bound given positive impact of favorable mix (increasing share of premium ICE two-wheeler and three-wheeler), operating leverage to off-set by increased marketing spends coupled with higher share of elecytric vehicles (even though PLI benefits have started to accrue).

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit. 

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.