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May 23, 2012, 04.54 PM IST
Two-wheeler major Bajaj Auto's net profit declined 45% year-on-year to Rs 772 crore in the fourth quarter. It had Rs 827 crore surplus on pre-payment of sales tax deferral liability in the year ago quarter.
Two-wheeler major Bajaj Auto 's net profit declined 45% year-on-year to Rs 772 crore in the fourth quarter. It had Rs 827 crore surplus on pre-payment of sales tax deferral liability in the year ago quarter.
The company's profit after tax excluding exceptional items was up 12% to Rs 759 crore. Its operating margin was at 19.7%.
While net profit met expectations, total income rose lower-than-expected 12% from a year ago to Rs 4,651 crore in Jan-March.
Analysts on average had expected Bajaj Auto's quarterly net profit at Rs 770 crore on revenue of Rs 4,780 crore.
It had an EBITDA of Rs 972 crore and EBITDA margin of 20.7% last quarter.
Two-wheeler makers saw good growth for most of 2011-12, but hit speed bumps in the domestic market in Jan-March.
Bajaj Auto said its sales crossed 1 million units for the fourth quarter in a row. But its 10,17,167 unit sales were up just 7% in the quarter. For the full year, its total vehicle sales rose 14% to 43,49,560 units.
The company's motorcycle exports surged 28% to 2,80,732 units last quarter. But in comparision, sales in India fell slightly to 6,16,516 units from 6,17,255 units a year ago.
Its commercial vehicle (three-wheeler) sales were up 8% to 1,19,919 units in Jan-March. While CV exports rose 18%, domestic sales were down 3%.
Bajaj Auto MD Rajiv Bajaj told CNBC-TV18 that domestic market continued to be soft but for now he is hopeful the company will be able to sell 50 lakh units in the current financial year.
He is banking on new launches like the Pulsar 200 NS and new Discover to help it maintain sales momentum.
The Pulsar 200 NS, for instance, a premium offering priced just under Rs 1 lakh, will hit showrooms in Maharashtra next week, according to Bajaj. It will be rolled out in other states by July, while overseas shipments will begin in August.
Bajaj Auto had unveiled its first four-wheeler offering the RE60 in Jan. Rajiv Bajaj said it was progressing as per plan. Its final tests are underway and the product should be launched towards the year-end, he said.
As of March 31, Bajaj Auto had surplus cash and cash equivalent of Rs 5,451 crore.
Bajaj Auto's shares slipped 1.2% at Rs 1,595 as the street was somewhat disappointed with the lower sales figures.
Analysts, however, remain bullish on the company and say the increasing share of exports and the new launches this year, holds it in good steed.
"Though there has been near term concerns on slowing urban demand we believe the segment will be first to catch up as sentimental factors improve. We like Bajaj Auto due to higher exposure to exports and launch of new vehicles on the horizon which will drive future volume growth," said Ronak Sarda, analyst at MSFL.
Bajaj Auto's exports now contribute 36% of overall sales. Exports to Sri Lanka were nil this month, due to the steep increase in import duty by the island nation. But Rajiv Bajaj is hopefull, exports there will come back to normal levels from next month. He also said that exportsto markets apart from Sri Lanka have been strong.
Sarda of MSFL has a "buy" rating on Bajaj Auto with a target price of Rs 1,905.
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