Bajaj Auto eyes stronger Q3 exports, boosts CNG capacity and preps for Chetak upgrade

Bajaj Auto shares have rallied 70 percent since the start of the year.

Bajaj Auto Limited, one of India's largest two and three-wheeler companies, reported a strong performance in its Latin American (LATAM) markets, with 20 percent year-on-year growth, although African markets continued to decline. The company is optimistic about exports in the coming quarter, expecting a better showing in Q3 compared to Q2.

Domestically, the 125cc+ segment has been gaining traction, while the 100cc segment has seen a slowdown at the industry level. Bajaj Auto is also scaling up its CNG bike production, aiming for a capacity of 30,000 units per month in the third quarter and 40,000 units per month in Q4. Additionally, Bajaj plans to roll out upgraded versions of its popular Chetak scooters in November.

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On the global front, Bajaj Auto is strengthening its presence in Brazil by ramping up its manufacturing capacity in 2024. The company will boost production at its Manaus facility from 20,000 units to 35,000 units annually, supported by a Rs 84 crore investment into its Brazilian arm, Bajaj Do Brasil Comercio De Motocicletas Ltda.

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The Manaus facility in the country spans 9,600 square meters and handles both engine and vehicle assembly, with testing capabilities. There is also room for scaling up production to 50,000 units annually.

Bajaj Auto reported a 9 percent increase in standalone net profit to Rs 2,005 crore for the second quarter of FY2024-25, falling short of analysts' estimates. Profit After Tax (PAT) grew from Rs 1,836 crore in the same quarter last year.

Revenue for the July-September period rose 22 percent to Rs 13,127 crore, compared to Rs 10,777 crore in the previous year, the company said in a stock exchange filing. Bajaj Auto highlighted that electric and CNG vehicles now account for 40 percent of its total domestic revenues across both two-wheeler and three-wheeler segments.

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A Moneycontrol poll of eight brokerages had forecast a 21 percent year-on-year increase in net profit to Rs 2,227 crore and a 23 percent rise in revenue to Rs 13,266 crore, driven by higher volumes and a more diverse product mix.

The results were announced after market hours and Bajaj Auto shares ended almost a percent higher at Rs 11,617. Bajaj Auto shares have rallied 70 percent since the start of the year.

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