Bajaj Auto - Q1FY21 Result Update - ICICI Securities

Bajaj Auto (BAL) reported healthy Q1FY21 results. Net revenues came in at Rs. 3,079 crore (down 60.3% YoY) tracking higher-than-expected blended ASPs, which were at Rs. 69,493/unit (up 6.9% YoY). Total volumes were down 64.5% YoY to 4.4 lakh units (2-W volumes 4.0 lakh units, down 63% YoY; 3-W volumes 43,174 units, down 73.8% YoY). Total exports were at 2.5 lakh units, down 54% YoY. Reported EBITDA margins came in at 13.3% (down 511 bps QoQ) amid gross margin expansion of 130 bps (including impact of forex gains). Consequent reported PAT was down 53.1% YoY at Rs. 528 crore. At the consolidated level, share of loss from KTM amounted to Rs. 132 crore.

Valuation & Outlook

For BAL, sales, PAT are expected to be largely flattish on a CAGR basis in FY20-22E with de-growth in FY21E being followed by healthy growth in FY22E. We value BAL at a revised target price of Rs. 3,210 using SOTP method (valuing core business at 18x FY22E EPS and assigning 2x P/B on KTM investment). We continue to assign HOLD rating to the stock. We derive comfort from debt free, cash rich B/S, capital efficient business model and robust cash flow generation.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_BajajAuto_Q1FY21.pdf

Shares of BAJAJ AUTO LTD. was last trading in BSE at Rs.2985.6 as compared to the previous close of Rs. 3004.35. The total number of shares traded during the day was 78198 in over 7972 trades.

The stock hit an intraday high of Rs. 3025 and intraday low of 2928.55. The net turnover during the day was Rs. 232319991.

Source : Equity Bulls

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