Bajaj Auto shares rise 3% post Q3 earnings: Should investors buy, sell, or hold?
Bajaj Auto shares surged 2.74% to Rs 8,628.10 after reporting a three per cent YoY rise in Q3 profit. Analysts are split on its future, citing strong exports but domestic market concerns.
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Stock rallies as Q3 numbers beat estimates Bajaj Auto shares surged 2.74% to Rs 8,628.10 on January 29, following the release of its Q3 FY24 results. The company reported a three per cent year-on-year (YoY) increase in standalone net profit at Rs 2,109 crore, driven by strong exports and cost efficiencies. Revenue from operations rose six per cent YoY to Rs 12,807 crore, despite a two per cent sequential decline.
EBITDA growth and margin expansion fuel optimism The two-wheeler giant posted a six percent YoY rise in EBITDA at Rs 2,581 crore, with margins expanding 10 basis points to 20.2 per cent. Analysts attribute this to favourable USD/INR realizations and efficient pricing strategies. The management remains bullish in the next few quarters, expecting export growth to exceed 20% and domestic growth to be at six to eight per cent.
Diverging analyst views: Buy or sell? Brokerages have mixed opinions on Bajaj Auto’s stock. Nuvama maintained a ‘Buy’ rating, setting a target price of Rs 10,700. The firm projects an 11 per cent revenue CAGR over FY25–27E, supported by a seven per cent volume CAGR in the two-wheeler segment. In contrast, Axis Capital downgraded its target price to Rs 7,550, citing market share concerns and lower volume expectations.
Robust exports counter domestic slowdown While total volumes increased two per cent YoY to 12.24 lakh units, export performance outshined the domestic market, where demand remained sluggish. Analysts expect Bajaj Auto to maintain its export momentum, particularly in Latin America and Africa, boosting long-term profitability.
Final take: Should you invest? With strong export potential and cost efficiencies, Bajaj Auto remains an attractive bet for long-term investors. However, concerns around domestic market share losses and lower volume assumptions could weigh on near-term performance. Investors should track upcoming quarters for clarity on-demand recovery and market positioning before making a decision.
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