Bajaj Auto Q3 Results: Profit Rises As Lower Costs Drive Up Margin, Beats Estimates

Bajaj Auto's Q3 operating profit surged 29% to Rs 1,776.81 crore compared to a forecast of Rs 1,563 crore.

<div class="paragraphs"><p>(Photo: Vijay Sartape/BQ Prime)</p></div>
(Photo: Vijay Sartape/BQ Prime)

Bajaj Auto Ltd.'s quarterly profit rose, beating analysts' estimates, due to lower operating costs even as two-wheeler sales volumes fell.

The company's net profit rose 23% to Rs 1,491.4 crore in the quarter ended December, according to its exchange filing. That compares to the Rs 1,379.1 crore consensus forecast of analysts tracked by Bloomberg.

Bajaj Auto Q3 FY23 Highlights (YoY):

  • Revenue rose 3% to Rs 9,315.1 crore against an estimate of Rs 8,998.5 crore. 

  • Operating profit surged 29% to Rs 1,776.81 crore compared to a forecast of Rs 1,563 crore.

  • Operating margin stood at 19.1%, as against 15.2% last year, and estimates of 17.4%.

The company's Rs 1,777-crore operating profit was the highest ever in a quarter, surpassing the record set in the preceding quarter.

Expansion in Ebitda margin was led by judicious pricing, improved dollar realisation and richer product mix, the company said in a release.

"On exports, macro-economic challenges continue to subdue industry volumes across overseas geographies. While the Company continues to navigate this situation through decisive actions, market share remains stable and the resilient performance in ASEAN is alleviating in part, the drop in volumes across other regions," the release said.

The two-wheeler maker's total sales in the quarter fell 17% year-on-year and 15% sequentially to 9.8 lakh units.

Weakness in both domestic and overseas markets amid a looming global recession led to overall decline in sales. Sequentially, net profit fell 3%, while revenue declined 9%.

Shares of Bajaj Auto closed 1.5% higher before the results were announced, compared with a 1.3% fall in the NSE Nifty 50 Index.