Bajaj Auto hits 52-week high after BofA Securities turns bullish, revises target price

Given such factors, the broking firm predicts that the company should see a revenue compound annual growth rate (CAGR) of 14-15 percent from FY23-26

Shares of Bajaj Auto Limited advanced nearly 5 percent to hit a 52-week high of Rs 5,078 in early trade on September 15 after BofA securities revised its recommendation on the stock to 'Buy' from Neutral, citing multiple levers to growth.

Furthermore, the brokerage firm has also raised the target price to Rs 5,550, an upside potential of about 15 percent from the closing price of September 14. The earlier target price assigned by the analysts was Rs 5,100.

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Analysts at the firm said that, for the company, the 'time to triumph' is right now and suggest there are multiple triggers for the growing sentiment for the two-wheeler automobile giant.

A gradual recovery in the domestic two-wheeler industry, coupled with the recovery in the three-wheeler segment bode well for the company. "All segments well set for positive growth in FY25", BofA said in a note on September 14. Moreover, the report also added that exports and electric vehicle verticle can drive valuation re-rating.

On exports, BofA said it has turned a corner, suggesting that the worst is over and things shall begin to improve. August's export figures are a case in point after Bajaj reported a two percent growth to 1,24,211 units.

Given such factors, the broking firm predicts that the Pune-headquartered company should see a revenue compound annual growth rate (CAGR) of 14-15 percent from FY23-26.

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