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Informist, Monday, Aug. 4, 2025

 

By Narayana Krishna

 

HYDERABAD - Muted volume growth, adverse product mix and weakness in domestic sales are likely to impact Bajaj Auto Ltd.'s June quarter earnings, according to analysts. Pune-based two-wheeler and three-wheeler maker is likely to see weakness in June quarter with lower single-digit net profit growth. This will be an eight-quarter low and the weakest net profit growth that the company reported since it contracted 2.5% in the March quarter of 2022-23 (Apr-Mar).

 

The company's June quarter margins are also expected to see pressure due to increased input costs, analysts said. Bajaj Auto is expected to report a 2% on-year rise in its June quarter net profit at INR 20.3 billion, according to an average of estimates from 10 brokerages. Analysts project revenue for the quarter to rise 3% on year to INR 123.1 billion. On a trailing basis, the company's net profit is expected to fall 1%, but revenue is seen rising 1%, the estimates show. For Apr-Jun last year, Bajaj Auto's on-year net profit growth was at 19.44%.

 

InCred Research Services Pvt. Ltd. has the highest estimates for both the top and bottom line, projecting a net profit of INR 21.1 billion and revenue of INR 126.8 billion. On the lower end, Nirmal Bang Equities Pvt. Ltd. estimates net profit at INR 19.8 billion, and Nomura Equity Research pegs revenue at INR 121.5 billion.

 

Bajaj Auto's board will meet on Wednesday to consider June quarter earnings.

 

Bajaj Auto sold 1.1 million units in June quarter, nearly 1% higher than last year. Domestic despatches fell 8% on year to 634,808 units, while exports grew 16% to 476,429 units, according to the company filing.

 

InCred Research, with a positive outlook on Bajaj Auto, said growth in electric two-wheeler and three-wheeler segments and revival in sales of its luxury bike KTM are likely to help Bajaj Auto's June quarter earnings performance. Nomura expects revenue to be up 2% on year with a flattish 1% on-year increase in volumes.

 

Kotak Institutional Equities expects Bajaj Auto's June quarter revenues to increase by 3% year-on-year, led by a 1% on-year increase in volumes and a 2% increase in average sales price due to a higher mix of exports in the three-wheeler segment and production-linked incentives accrual.

 

HDFC Securities Ltd. expects realisations to remain flat quarter-on-quarter, as an unfavourable domestic product mix offsets a better exports mix. It also believes price hikes driven by On-Board Diagnostics Stage-II, or OBD-II, emission norms will be nullified by higher discounts and adverse forex movements.

 

MARGINS

Bajaj Auto is expected to report a fall in its June quarter earnings before interest, tax, depreciation and amortisation margins due to factors like rise in raw material prices, an adverse product mix, currency appreciation and increased logistics costs, analysts said.

 

Motilal Oswal Financial Services Ltd. said Bajaj Auto's June quarter two-wheeler share in overall exports fell to 38% of total volumes from 52?rlier. Along with an adverse product mix, rupee appreciation also impacted the company's margin profile for the June quarter, the brokerage said. Motilal Oswal expects Bajaj Auto's June quarter EBITDA margins to contract by 50 basis points on both year-on-year and quarter-on-quarter basis to 19.7%.

 

Kotak expects Bajaj Auto's EBITDA margins to fall by 64 bps on year and 56 bps on quarter, while Nomura sees it flat on trailing basis at 20.2% due to an increase in raw material costs. The average of estimates from the eight brokerages for the company's June quarter EBITDA is pegged at INR 24.6 billion.

 

Analysts are watching for the company's commentary on demand outlook and new product launch timelines, along with electric vehicles' growth outlook.

 

At 1316, shares of Bajaj Auto were trading at INR 8,179 on the National Stock Exchange, up nearly 1.7%. The stock fell nearly 8% since the company announced its March quarter earnings.

 

Of the 23 brokerage reports on the company available with Informist, 13 have a "buy" rating with an average target price of INR 9,700. Eight brokerages have a "hold" rating with a target price of INR 10,027 and two have a "sell" rating on the stock with INR 7,217 target price.

 

 

Following are the Apr-Jun earnings estimates for Bajaj Auto Ltd. based on reports from 10 brokerage firms in descending order by the estimate of net profit:

Brokerage name	Net Sales	Net Profit	EBITDA
	--in million rupees--
InCred Research Services Pvt Ltd	1,26,788.00	21,091.00	25,594.00
YES Securities (India) Ltd	1,23,129.00	20,640.00	25,000.00
Nomura Equity Research	1,21,466.00	20,598.00	24,566.00
JM Financial Institutional Securities Pvt Ltd	1,23,006.00	20,260.00	24,355.00
Nuvama Wealth Management Ltd	1,22,884.00	20,237.00	24,099.00
Kotak Institutional Equities	1,23,032.00	20,186.00	24,136.00
Anand Rathi Share and Stock Brokers Ltd	1,22,119.00	20,104.00	--
HDFC Securities Ltd	1,22,449.00	20,032.00	--
Motilal Oswal Financial Services Ltd	1,22,679.00	19,843.00	24,164.00
Nirmal Bang Equities Pvt Ltd	1,23,068.00	19,804.00	24,983.00
Average	1,23,062.00	20,279.50	24,612.13

 

End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Deepshikha Bhardwaj

 

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