Bajaj Auto Q3FY22 Preview: Revenue seen at Rs88,418 million, PAT at Rs12,025 million

18 Jan 2022 , 04:16 PM

Result date: 19th January, 2022
Recommendation: Add
Target price: Rs. 3,960

Bajaj Auto witnessed a 10% YoY decline in volumes, realizations will aid topline. On a YoY basis, revenue is estimated to be flattish with a negative bias (down 0.8%) to Rs88,418 million. While the company has implemented price hikes in Q3, they may not be adequate to offset full pressure arising from input cost inflation.

Sequentially, the volumes grew 3.2%, indicating an uptick in demand. Exports are likely to remain strong and aid the company’s growth as well as profitability.

While rising input costs (particularly aluminium) will put pressure on margins; these will be partly offset by higher operating leverage, benefits from favorable movement in forex and higher sales of 3 wheelers.

Important management insights to watch out for:
– Demand trends in domestic market
– Price hikes planned, outlook on margins

	December 2021 estimates	YoY change	QoQ change
Volumes	1,181,361	(9.6%)	3.2%
Revenue (Rs. Million)	88,418	(0.8%)	2.6%
EBITDA (Rs. Million)	13,109	(24.2%)	4.1%
EBITDA margin (%)	14.8%	(459) bps	22 bps
PAT (Rs. Million)	12,025	(22.7%)	2.9%

Source: IIFL Research, Company