Bajaj Auto - March 2013 Results Preview - Motilal Oswal

- Expect 4QFY13 volumes to rise 3% YoY (-7% QoQ) to 1.05m.

- EBITDA margins are likely to drop 50bp QoQ (-160bp YoY) to 18.2% led by weaker product mix (higher share of Platina, lower 3W volumes), partly offset by full benefit of price hike in exports effective Nov-12 to pass on impact of export incentive reduction.

- Expect PAT to decline 3% YoY (-11% QoQ). PAT decline is higher than that of EBITDA due to higher tax rate on partial expiry of tax incentives in Pantnagar plant.

- We cut FY14/FY15 EPS by 6.1%/4.2% as we lower our FY14 growth assumption on slower economic recovery.

- We have cut our FY14E/FY15E EPS by 6.1%/4.2% respectively.

- The stock trades at 14.4x/12.5x FY14E/FY15E EPS respectively. Maintain Buy.

Source : Equity Bulls

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