X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Bajaj Auto Limited: Recovery in Exports but Domestic Disappoints! - Views on News from Equitymaster
StockSelect
  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  
  • Home
  • Outlook Arena
  • Aug 1, 2017 - Bajaj Auto Limited: Recovery in Exports but Domestic Disappoints!

Bajaj Auto Limited: Recovery in Exports but Domestic Disappoints!
Aug 1, 2017

Bajaj Auto Limited has announced its financial results for the first quarter of the financial year 2017-18 (1QFY18). During the quarter, company faced saw some recovery in the exports markets, while domestic motorcycle market continued to witness pain. Revenue were down 3.9% YoY and adjusted net profits were down by 4.7%.

Performance summary
  • For 1QFY18, the revenue was down by 3.9% YoY. Overall volumes de-grew by 10.7% YoY. While the exports market showed some recovery, and was up 10% YoY, the domestic market declined by 17% YoY.
  • After the preponement of industry sales before April due to the transition from BS-III to BS-IV (liquidating inventory at higher discounts), the quarter was challenging specially for Bajaj Auto. However, given the increase in raw material prices and increased cost of BS-IV, company has taken hike of 7.7% YoY in realisation.
  • Motorcycles - Domestically it declined by 17% YoY. This was largely because pre-buying of the competitor's product in March (BSIII to BSIV transition).
  • Commercial Vehicles (Three wheelers) - Even though three wheelers market saw some recovery, it was down 30% YoY as last year same time the industry saw huge permits.
  • Exports markets showed some signs of improvement and motorcycles grew by 8% YoY and commercial vehicles were up by 28% YoY.
  • Operating profits for the quarters declined by 20.2% YoY with margins contracting by 329.1 bps to 16%. The contraction in the margins was on the back of high discounting for Platina & CT100 and de-stocking in the month of June due to GST.
  • Adjusted Net profits were down by 4.7% YoY, with margins contracting by 13.5 bps to 15.9%.

    Standalone Financial Performance Snapshot
    (Rs m) 1QFY17 1QFY18 Change
    No. of Vehicles sold 994,733 888,434 -10.7%
    Net sales 60887.50 58541.90 -3.9%
    Expenditure 49124.20 49158.40 0.1%
    Operating profit (EBDITA) 11,763 9,384 -20.2%
    EBDITA margin (%) 19.3% 16.0% -329.10
    Other income 2670.60 4572.80 71.2%
    Depreciation 774.70 752.60 -2.9%
    Interest 2.20 2.40 9.1%
    Profit before tax 13,657 13,201 -3.3%
    Exceptional Item   -320.00  
    PBT 13,657 12,881 -5.7%
    Tax 3873.30 3642.00 -6.0%
    Profit after tax / (loss) 9,784 9,239 -5.6%
    Net profit margin (%) 16.1% 15.8% -28.61
    Adjust PAT 9,783.7 9,327.6 -4.7%
    Adjusted Net profit margin (%) 16.1% 15.9% -13.53
    No. of shares (m)   289.4  
    Diluted earnings per share (Rs)*   135.2  
    Price to earnings ratio (x)*   20.8  

    *based on 12 month trailing earnings

To Read the Full Story, Subscribe or Sign In



DISCLOSURES UNDER SEBI (RESEARCH ANALYSTS) REGULATIONS, 2014
INTRODUCTION:
Equitymaster Agora Research Private Limited (hereinafter referred to as "Equitymaster"/"Company") was incorporated on October 25, 2007. Equitymaster is a joint venture between Quantum Information Services Private Limited (QIS) and Agora group. Equitymaster is a SEBI registered Research Analyst under the SEBI (Research Analysts) Regulations, 2014 with registration number INH000000537.

BUSINESS ACTIVITY:
An independent research initiative, Equitymaster is committed to providing honest and unbiased views, opinions and recommendations on various investment opportunities across asset classes.

DISCIPLINARY HISTORY:
There are no outstanding litigations against the Company, it subsidiaries and its Directors.

GENERAL TERMS AND CONDITIONS FOR RESEARCH REPORT:
For the terms and conditions for research reports click here.

DETAILS OF ASSOCIATES:
Details of Associates are available here.

DISCLOSURE WITH REGARDS TO OWNERSHIP AND MATERIAL CONFLICTS OF INTEREST:
  1. 'subject company' is a company on which a buy/sell/hold view or target price is given/changed in this Research Report.
  2. Equitymaster has financial interest in Bajaj Auto.
  3. Equitymaster's investment in the subject company is as per the guidelines prescribed by the Board of Directors of the Company. The investment is however made solely for building track record of its services.
  4. Equitymaster's Associates and Research Analyst or his/her relative doesn't have any financial interest in the subject company.
  5. Neither Equitymaster, it's Associates, Research Analyst or his/her relative have actual/beneficial ownership of one percent or more securities of the subject company at the end of the month immediately preceding the date of publication of the research report.
  6. Neither Equitymaster, it's Associates, Research Analyst or his/her relative have any other material conflict of interest at the time of publication of the research report.
DISCLOSURE WITH REGARDS TO RECEIPT OF COMPENSATION:
  1. Neither Equitymaster nor it's Associates have received any compensation from the subject company in the past twelve months.
  2. Neither Equitymaster nor it's Associates have managed or co-managed public offering of securities for the subject company in the past twelve months.
  3. Neither Equitymaster nor it's Associates have received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past twelve months.
  4. Neither Equitymaster nor it's Associates have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months.
  5. Neither Equitymaster nor it's Associates have received any compensation or other benefits from the subject company or third party in connection with the research report.
GENERAL DISCLOSURES:
  1. The Research Analyst has not served as an officer, director or employee of the subject company.
  2. Equitymaster or the Research Analyst has not been engaged in market making activity for the subject company.
Definitions of Terms Used:
  1. Buy recommendation: This means that the subscriber could consider buying the concerned stock at current market price keeping in mind the tenure and objective of the recommendation service.
  2. Hold recommendation: This means that the subscriber could consider holding on to the shares of the company until further update and not buy more of the stock at current market price.
  3. Buy at lower price: This means that the subscriber should wait for some correction in the market price so that the stock can be bought at more attractive valuations keeping in mind the tenure and the objective of the service.
  4. Sell recommendation: This means that the subscriber could consider selling the stock at current market price keeping in mind the objective of the recommendation service.
Feedback:
If you have any feedback or query or wish to report a matter, please do not hesitate to write to us.

Become A Smarter Investor In
Just 5 Minutes

Multibagger Stocks Guide 2017
Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
We will never sell or rent your email id.
Please read our Terms

BAJAJ AUTO SHARE PRICE


Oct 17, 2017 (Close)

TRACK BAJAJ AUTO

  • Track your investment in BAJAJ AUTO with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks

BAJAJ AUTO 5-YR ANALYSIS

Detailed Financial Information With Charts

COMPARE BAJAJ AUTO WITH

MARKET STATS