ICICI Direct's research report on Bajaj Auto
Bajaj Auto (BAL) is second largest motorcycle manufacturer and largest 3-W OEM domestically (FY22 market share at 18.2%, 61.5% respectively). • Exports comprised ~58% of FY22 volumes; 2-W:3-W mix at ~89:11 (overall) • Strong b/s with ~Rs 23,160 crore cash on books (FY22), history of ~20% return ratios & one of the highest dividend yields among Nifty stocks.
We maintain HOLD rating on the stock primarily tracking management’s conservative stance on EV transition amid prominence in export markets. Rolling over our valuations, we value BAL at Rs 3,950 on SOTP basis (18x PE on FY24E Core EPS, stake in PMAG; previous target: ₹ 3,370).