Buy Bajaj Auto; target of Rs 11,100: Emkay Global Financial

Emkay Global Financial is bullish on Bajaj Auto has recommended buy rating on the stock with a target price of Rs 11,100 in its research report dated January 06, 2026.

Broker Research

January 06, 2026 / 12:37 IST

Buy

Emkay Global Financial' research report on Bajaj Auto

We believe BJAUT offers an attractive risk-reward at current levels (1YF at 24x vs 38x/32x for TVSL/EIM), backed by strong exports trends coupled with launch of a refreshed Pulsar range in CY26 translating into a healthy 14% EPS CAGR over FY26E-28E. BJAUT’s overall domestic 2W market share has bottomed out, with slight pick-up, driven by market share of both premium motorcycles and e-scooters in Q3FY26TD. Export momentum remains strong, led by LatAm/Asia, which coupled with currency depreciation-led tailwinds should aid the overall margin trajectory given its strong exports volume mix (~44% mix as of FY26YTD vs 39% in FY25YTD). BJAUT’s e-3W portfolio has also scaled up meaningfully, and overtaken M&M to become the #1 in E-3Ws (~31.8% market share in Dec-25 vs 31.9% in FY25) while sustaining its #2 spot in E-2Ws for the last 4M, with EBITDA breakeven already achieved. Also, a gradual turnaround in KTM provides incremental upside potential.

Outlook

We upgrade BJAUT to BUY from Add and roll forward our TP to Dec-27E, hoisting it ~17% to Rs11,100 (from Rs9,500). This implies an upside of ~17% (+2.7% dividend yield in Dec-27E) on account of FY27E/28E EPS upgrade by ~4/9% and incorporating Bajaj Auto Credit at Rs300/sh, basis 2x FY28E P/B, given the meaningful ramp-up in operations (H1FY26 PAT at Rs2.3bn vs Rs0.6bn in FY25).

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