Bajaj Auto Q2FY23 Results Preview: Double-digit year-on-year growth on cards? Check expectations

Bajaj Auto Q2FY23 Result Preview: Bajaj Auto is expected to post strong earnings in the second quarter of the financial year 2022-23 (Q2FY23), with double-digit growth likely in the top and bottom lines, as per Zee Business research. The two-wheeler company is scheduled to release its Q2 earnings on Friday, October 14, 2022.

In Q2FY23, the company’s revenue may grow by 20.6 per cent year-on-year (YoY) to Rs 9,655 crore (estimate) as compared to Rs 8,005 crore in the same quarter a year ago. While its profit may surge by 18.6 per cent to Rs 1,391 crore (estimate) in Q2FY23 as against Rs 1,173 crore in Q2FY22.

Similarly, Bajaj Auto’s EBITDA (earnings before interest, taxes, depreciation, and amortization) may also come in double-digits, up by 21.8 per cent to Rs 1,580 crore (estimate) in Q2Fy23 versus Rs 1,297 crore in a year ago quarter. While margins may come to 16.4 per cent from 16.2 per cent YoY.

The automobile company may witness a volume growth of 0.6 per cent to 11,51,000 units in the July-September quarter of this fiscal and realisation to grow by 14.7 per cent YoY to 86382/unit, Zee Business research team said in its Bajaj Auto results Q2FY23 preview.

It further added that the two-wheeler domestic demand is showing signs of a recovery, however, the exports remain weak and semiconductor shortages have started to ease, benefitting the production of premium motorcycles and electric vehicles.

In line with Zee Business expectations, Motilal Oswal said, “The entire benefit of a correction in raw material cost and a weaker USD:INR to reflect in Q3FY23 and expects the margin to improve on a quarter-on-quarter basis, driven by price hikes, a weak USD:INR, and operating deleverage.”

The domestic brokerage gives a Neutral rating on the stock with a target price of Rs 4000 apiece, implying over 13 per cent upside in the stock from Tuesday’s closing of Rs 3525 apiece, down over 2.5 per cent on the NSE.

Even YES Securities sees double-digit growth for Bajaj Auto in Q2FY23 on all fronts. It said, “We expect margins to expand around 220 bp YoY/200 bp QoQ at 18.2 per cent due to benefits arising from softening of raw material prices and INR depreciation due to higher exports.”

Bajaj Auto on Monday said it has bought back over 64 lakh shares from public shareholders for Rs 2,499.97 crore under its share buyback exercise, as per exchange filing.

The company, which had commenced the share buyback on July 4, 2022, said in a filing that its Buyback Committee at its meeting held on Monday approved the completion and closure of the exercise from October 10, 2022.