Bajaj Auto Q2 FY25 Results: Profit Grows 9% Amid Rising Volumes, Shares Drop

Bajaj Auto Ltd reported a 9.1% year-on-year (YoY) rise in standalone net profit for the second quarter (Q2 FY25), reaching ₹2,005 crore, despite a significant tax hit of ₹211 crore. This increase came alongside a 21.8% YoY growth in revenue from operations, which stood at ₹13,127.47 crore, supported by a 16% volume growth to 12 lakh units. Despite the positive profit trajectory, the company’s shares experienced a significant drop, falling over 8% following the results, as investors reacted to lower-than-expected realisations.

The company’s earnings before interest, tax, depreciation, and amortisation (EBITDA) grew by 24% YoY to ₹2,653 crore, marking its best-ever performance with an EBITDA margin of 20.2%, a slight 40 basis point improvement. However, this was still below market estimates due to a miss in revenue forecasts. Revenue per unit increased by 5% to ₹107,470, contributing to the company’s financial performance, but fell short of market expectations, which tempered investor sentiment.

Bajaj Auto’s motorcycle segment maintained double-digit growth, bolstered by the strong performance of the Pulsar brand in the premium market. Additionally, the company’s focus on innovative products, such as the recently launched Freedom 125, the world’s first CNG-integrated bike, contributed positively. In the second quarter, Bajaj Auto also achieved the milestone of selling 100,000 electric vehicles.

Regarding geographical performance, domestic sales of two-wheelers grew by 28%, while exports increased by 13%. The company’s commercial vehicle segment also posted modest growth, with domestic sales rising 4% and exports climbing 16%.

Looking ahead, Bajaj Auto has invested ₹84 crore in its Brazilian subsidiary to support business expansion, reflecting its focus on international markets. The company’s balance sheet remains strong, with surplus cash of ₹16,392 crore after strategic investments and dividend distribution.

Bajaj Auto Share Price Performance

On October 17, 2024, Bajaj Auto share price opened at ₹10,877.75, but by 9:15 AM, it had dropped significantly to ₹10,567.00, down 9.01% from its previous close. This sharp decline followed the release of the company’s less-than-expected September quarter results, which impacted investor sentiment despite a rise in net profit and revenue. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.