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Bajaj April volumes fail to enthuse

May 3, 2000

Bajaj Auto Ltd (BAL) has reported a growth in volumes of 17% YoY in April 2000 to 1,14,000 units as compared to 97,218 units sold in April 1999. These are flash figures reported by BAL on its website and detailed break-up as of now is not available. BAL is the world's third and India's largest two wheeler manufacturer. The company commands a 57% market share in scooters, 7% in mopeds and 22% in motorcycles. BAL reported a turnover of Rs 35.3 bn for FY99.

  Units sold* % change
Apr-00 114,000 17%
Apr-99 97,218 -4%
Apr-98 101,745 -

* including CKD sets supplied to MSL

As break up between different segments is not available, it would not be fair to comment on which segment the growth has come from.

However these figures do not necessarily imply that BAL's volume growth has been very good in April 2000. The reason being that in March 1999 the company sold 172,264 units and in March 2000 it sold only 147,052 units, a decline of 15% YoY. The higher sales in March 1999 resulted in a drop in volumes in April 1999. Hence the figures for April 2000 appears to be better, but the fact is that this growth is because of a lower base in April 1999.

The combined sales figures actually show a clearer picture. The combined sales units for March-April 2000 was 261,052 units, a decline of 3% YoY as compared to 269,482 units sold in the months of March-April 1999.

Market View :
BAL has been rated a "BUY" by many analysts due to the pick up in two wheeler demand. However some analysts and fund managers have not been very positive on the company as it is sitting on a huge pile of cash and investments without any clear plans about its usage.

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