Bajaj Auto Q4 results preview: Strong domestic volumes and exports recovery to ride a smooth March quarter

Bajaj Auto is set to report a strong January to March 2024 quarter on April 18 with margin expected to expand on the back of lower inputs costs alongside strong volume growth and pick up in export business.

Bajaj Auto shares will be in focus as the two and three-wheeler maker is expected to report its quarterly results around noon. The stock has increased investors’ wealth by more than 110% in the past year as against benchmark Sensex which has risen 22% during the period. In the six months, the shares have gone up 74% compared to a 10% surge in Sensex for the period.

Earlier this month, the stock hit a record high of ₹9,356 on April 2.

According to a CNBC-TV18 poll of analysts, the company might report strong earnings for the last quarter of the 2023-24 fiscal year with 24% revenue growth and a stable margin at 20%.

The revenue is likely to come in ₹11,118 crore for the quarter under review compared to ₹8,904 crore in the year-ago quarter. The EBITDA or earnings before interest, taxes, depreciation, and amortisation could increase 28.8% to ₹2,211 crore in the March 2024 ended quarter as against ₹1,716 crore in the corresponding quarter a year ago.

Bajaj Auto’s operating margin shall increase from 19.3% in the March 2023 ended quarter to 19.8% in the same quarter of FY24. The margin expansion shall be led by lower input costs, improved mix and operating leverage benefits, analysts said.

The profit after tax (PAT) shall rise 30% year-on-year to ₹1,870 crore.

Among key factors to track include total volumes that are likely to have gone up 24% YoY at 10.69 lakh vs 8.60 lakh units. The company has witnessed strong domestic volume growth of 28% YoY whereas export volume growth has recovered at more than 19% YoY. On a sequential basis, the firm’s improved three-wheeler performance has also pushed the stock higher.

Meanwhile, the demand trends in the African and South Asian regions have also improved though on a lower base.

Global brokerage Goldman Sachs recently raised its target price on Bajaj Auto stock to ₹9,380 from ₹8,780 earlier.

Bajaj Auto shares closed almost a percent lower at ₹8,911 on NSE on April 16.