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Yes Securities Report
Bajaj Auto Ltd.'s Q4 FY23 results were better than expected with revenue/Ebitda/adjusted profit after tax beat our/consensus by 5.9%/10.6%/8.7% and 3.9%/9.2%/6%. This was led by record average selling price at Rs 103,400/unit (our estimate ~Rs 98,000, up 9.3% QoQ) and superior mix supported better gross margins at 30.2% (our estimate 29.6%, up 240 basis points YoY/ up 80 bps QoQ).
We believe margins to bottom out led by-
cost inflation (due to steel),
mix to moderate given QoQ exports volume recovery led by Africa and
increased contribution from electric vehicles (two-wheeler ramp-up to 10,000 units by June 2023 and three-wheeler launch by April 2023 end).
Overall demand outlook yet remained mix but improving as-
domestic volumes recovery continues to remain hopeful,
exports - near-term volumes to see recovery in dispatches contingent upon currency availability,
three-wheeler volumes expected to stabilise given healthy recovery over past year.
However, going ahead, Indian rupee depreciation, Triumph contribution favoring overall mix, remain an upside risk to our margins.
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