Bajaj Auto (BOM:532977)

The Hindu Business Line  Oct 13  Comment 
BPCL flared up 2.05 per cent to emerge the top gainer on the NSE on Tuesday morning. At 11.09 am the share was trading at Rs 866.45 against Rs 849.05 at close yesterday. Bajaj Auto was on...
The Hindu Business Line  Oct 13  Comment 
Bajaj Auto spurted up 1.65 per cent to lead the pack on the BSE on Tuesday. At 10.59 am the share was trading at Rs 2,465.30 against Rs 2,425.35 at close yesterday. Wipro gained 1.04 per...
The Economic Times  Oct 12  Comment 
"Bajaj Auto is a 'SELL' call with a target of Rs 2400 and a stop loss of Rs 2450."
The Economic Times  Oct 7  Comment 
"Bajaj Auto is a 'BUY' call with a target of Rs 2500 and a stop loss of Rs 2405."
The Hindu Business Line  Oct 5  Comment 
The onset of the festive season has still not brought much cheer to Bajaj Auto as the Pune-based motorcycles maker has seen its total sales during September dip by 4% to 3.84 lakh units against 3....
The Economic Times  Oct 5  Comment 
One lakh new auto permits in Mumbai will add huge to Bajaj Auto's numbers in a short period of time, says Sabharwal.
The Times of India  Sep 26  Comment 
Bajaj Auto on Friday named its quadricycle (codenamed RE60) as `Qute' and said it will begin exports of the vehicle to 16 countries even as an India launch will be delayed pending legal challenges.
The Hindu Business Line  Sep 25  Comment 
Will export vehicle to 16 countries; awaiting regulations for India launch
The Economic Times  Sep 22  Comment 
Risk-reward has become a little better at these valuations, says Dewan. Fall in rupee may aid Bajaj's export business, he adds.
The Economic Times  Sep 16  Comment 
70 companies from the BSE 500 index with ROCE above 15% are currently trading with FY17 estimated PEs of less than that of their past five-year averages.



Bajaj Auto Ltd. came in to existance in year 1945. It started selling vehicle in 1948 after importing them from abroad.

In 1959 Bajaj started its own manufacturing unit in India (Akurdi Plant) . and 1960 it became publicly listed company.

In 1970s it started producing three wheelers (for goods transport also) and became pioneer in three wheeler business.

in the same decade it started production of one of the most successfull scooter model in india Bajaj Chetak.

In 80s it started production of Bikes with Kawasaki bajaj but till year 2000 it was not a major player in Bike segment.

But in year 2001 Bajaj came with Pulsar and became major player in Power biking. And now bajaj planning to go in four wheeler pessenger car segment also with 2500$ car.

Quarterly Result Analysis- Sept '09

Performance summary

- Topline grows by a decent 15% YoY during the quarter. Volume growth comes in at 7% YoY.

- Operating profits jump a strong 85% YoY as the company achieves record operating margins of 22%, a more than 8% expansion as compared to the previous quarter.

- Further aided by benign depreciation charges and lower extraordinary expenses, net profits during the quarter witness a spectacular growth of 118% YoY, enabling the company to post its highest ever quarterly profits.

- Half yearly bottomline grows by 93% YoY on the back of a 8% growth in topline.

(Rs m) 2QFY09 2QFY10 Change 1HFY09 1HFY10 Change
Units sold 640,042 686,727 7.30% 1,260,137 1,234,389 (2.00%)
Net sales 25,192 28,875 14.60% 48,239 52,260 8.30%
Expenditure 21,753 22,510 3.50% 42,132 41,341 (1.90%)
Operating profit (EBDITA) 3,439 6,365 85.10% 6,106 10,919 78.80%
EBDITA margin (%) 13.60% 22.00% 12.70% 20.90%
Other income 221 217 (1.70%) 509 449 (11.80%)
Interest (net) 59 ( ) 68 60 (12.10%)
Depreciation 331 336 1.50% 666 667 0.10%
Profit before tax 3,270 6,247 91.00% 5,881 10,642 80.90%
Extraordinary income/(expense) (611) (458) (25.00%) (611) (699)
Tax 810 1,760 117.30% 1,670 2,980 78.40%
Profit after tax/(loss) 1,849 4,028 117.90% 3,600 6,963 93.40%
Net profit margin (%) 7.30% 14.00% 7.50% 13.30%
No. of shares (m) 144.7 144.7 144.7 144.7
Diluted earnings per share (Rs)* 68.5
Price to earnings ratio (x)* 22.9
                                                  (* annualised)

What has driven performance in 2QFY10?

- The 15% growth in topline during the quarter was driven by both higher volumes as well as improved product mix. Motorcycles, which account for nearly 90% of all the vehicles sold by the company, grew by 5% in the domestic markets, whereas exports of the same improved 10%. The growth in the domestic markets was driven by new launches like the upgraded version of the Pulsar as well as the Discover DTS-Si. The company also managed to grow the domestic sales of its three wheelers by an impressive 27% during the quarter, a feat that could be attributed to its marketing initiatives geared towards the in-city segment. On the exports front, with the revival of its key exports market, it witnessed highest ever quarterly exports and the company is now well poised to exceed its target of 0.8 m vehicles for the year.

- As far as margins are concerned, the company has managed to achieve record operating margins to the tune of 22% during the quarter. This was higher by more than 800 basis points as compared to the same quarter last year and enabled the company to grow its operating profits by 85% on a YoY basis. The drastic improvement in margins could be attributed to greater sales of high value products such as Pulsars, Discovers and three wheelers as well as benefits emerging out of the economies of scale. Going forward, while the same level of margins may not continue, it could indeed come higher than historical levels as the company focuses more on high value products.

- With depreciation charges remaining benign and extraordinary losses coming in lower as compared to same quarter last year, the company has managed to more than double its net profits during the quarter, growing it by 118% YoY.

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