By Bajaj Auto is gearing up to release its Q2FY25 earnings today, with market expectations pointing to a strong performance. Shares of the automaker have already seen an uptick ahead of the announcement, driven by optimism surrounding the company’s revenue growth and improved profitability.
Revenue Growth Driven by Sales Volume and Premium Segments
According to a survey conducted by Livemint among six brokerages, Bajaj Auto is projected to post a revenue increase of 23.41% year-over-year, reaching ₹13,300 crore, up from ₹10,777 crore in Q2FY24. This growth is largely fueled by a 16% year-on-year rise in sales volumes, amounting to 12.21 lakh units. The company’s strategy of expanding its premium two-wheeler segments, coupled with price hikes and increased exports, has bolstered its revenue prospects.
The rise in Average Selling Prices (ASP) also reflects the company’s shift towards a more premium product mix. This combination of higher sales volumes and increased ASP has positioned Bajaj Auto for a strong second quarter.
EBITDA Margins Expected to See Improvement
Alongside revenue growth, Bajaj Auto’s EBITDA margin is expected to increase by 52 basis points, climbing to 20.3%, compared to 19.8% in the same quarter last year. This improvement is attributed to several factors, including:
- A richer, more premium product mix
- Operating leverage from higher volumes
- Effective cost control measures
Analysts believe that Bajaj Auto’s focus on premium motorcycles and its strategic expansion into international markets have helped drive margin expansion. The company’s ability to manage costs, despite inflationary pressures, has been key to maintaining profitability.
Premium Segments and Exports to Lead Revenue Surge
The automaker’s strong focus on premium two-wheeler segments and its robust export growth are expected to continue propelling revenue forward. The 16% rise in sales volumes includes a noticeable increase in demand for premium motorcycles like the Pulsar and Dominar models.
Exports have also played a crucial role in Bajaj Auto’s performance, contributing to the overall sales volume growth. The company’s presence in global markets, especially in Africa and Latin America, has been a critical driver, with export volumes rising by 7% year-on-year.
Focus on CNG and E-Mobility Initiatives
Looking ahead, analysts will closely watch Bajaj Auto’s demand outlook for both domestic and international markets. Of particular interest will be the company’s progress in CNG and electric mobility (E-mobility) initiatives, as the global auto industry shifts towards greener technologies.
As Bajaj Auto continues to explore opportunities in these areas, the company’s ability to adapt to evolving market trends will be critical for sustaining its growth trajectory in the coming quarters.