Bajaj Auto - Low Raw Material Cost, Operating Leverage Drives Q3 Margin: Motilal Oswal
Bajaj Auto Ltd. Pulsar motorcycles sit ready at the end of the assembly line at the company’s factory in Pune, India. (Photographer: Kuni Takahashi/Bloomberg)

Bajaj Auto - Low Raw Material Cost, Operating Leverage Drives Q3 Margin: Motilal Oswal

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Motilal Oswal Report

Bajaj Auto Ltd.’s operating performance was driven by favorable mix, lower marketing spends, and operating leverage.

It has both near (three-wheeler recovery) and long term (premiumization and exports) levers, which are fairly reflected in current valuations.

Revenue/Ebitda/profit after tax grew 16.6%/26.5%/23.4% YoY. For nine months FY21, revenue/Ebitda/profit after tax declined 17.1%/11.4%/15% YoY.

We upgrade our FY21E/FY22E earning per share by 7%/5% to factor in mix, cost savings, and an upgrade in KTM’s profit after tax.

Click on the attachment to read the full report:

Motilal Oswal Bajaj Auto Q3FY21 Result Update.pdf


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