Bajaj Auto Q3 results update
Last updated: 21 Jan, 2021 | 01:55 pm
- Record profit: Bajaj Auto has reported the highest-ever quarterly profit and revenue in Oct-Dec 20 period, driven by robust exports and improvement in domestic sales. Net profit rose 23% on-year to Rs 1,556 crore, beating analyst estimates. Analysts had earlier estimated a profit of about Rs 1,373 crore.
- Revenue rises: Revenue from operations rose 17% to Rs 8,909.8 crore, against the Rs 8,619.8-crore forecast. The growth in revenue came as total exports grew 22.09% over the year earlier to 6.87 lakh units in the reported period. Notably, domestic sales are still down around 3.12% on-year, indicating that the company is still to recover from the impact of Covid-19 pandemic.
- Recovery due to festive season and pent-up demand: Domestic two-wheelers registered a strong turnaround in Oct-Dec 20 period, on the back of robust festive season and pent-up demand. Also, Bajaj Auto's move to hike prices from January could have led to pre-buying in December.
- Commercial vehicles (3-wheelers, Carriers) severely affected: Domestic market of commercial vehicles was severely impacted due to lack of commuting demand amid the pandemic. The recovery is dependent on the return of adequate short distance mobility demand. Bajaj Auto sold just 34,230 units in the quarter, down 65% as compared to the previous year.
Continuing the path of recovery from the zero sales in April, Indian two-wheeler manufacturers have now shown a robust growth in the preceding two quarters. The domestic two-wheeler continued to grow on the back of robust demand for Pulsar, Dominar, KTM and Husqvarna, commercial vehicle business continued to face pressure because of inadequate demand for short-distance mobility. Going forward, Bajaj Auto is well-positioned to take advantage of rising demand, as the economy improves further.