Bajaj Auto - Q2FY21 First Cut - ICICI Securities

(CMP: Rs. 3,008; MCap: Rs. 87,042 crore)

Bajaj Auto reported a steady Q2FY21 performance that was largely in line with our estimates.

Q2FY21 Earnings Summary

- Net revenues came in at Rs. 7,156 crore (down 7.2% YoY; I-Direct estimate - Rs. 7,192 crore). Blended ASPs for the quarter stood at Rs. 67,935/unit (up 3.4% YoY, down 2.2% QoQ; I Direct estimate Rs. 68,281/unit). Lower share of 3-W in total volumes (~8% in Q2FY21 vs. ~16% YoY) impacted ASPs, although rupee depreciation acted as a tailwind. Total volumes for the quarter were at 10.5 lakh units (down 10.2% YoY) units wherein 2-W volumes were at 9.6 lakh units (down 2% YoY) and 3-W volumes were 88,872 units (down 53% YoY)

- Reported EBITDA in Q2FY21 was at Rs. 1266 crore (down 1% YoY), with EBITDA margins coming in at 17.7% (up 110 bps YoY) - slightly ahead of our estimate of 17.1%. The beat was attributable primarily to lower other expenses, which fell 190 bps YoY on percentage of sales basis. The company informed that reversal impact of MEIS export incentive for the quarter stood at Rs. 78 crore, abstaining which EBITDA margins could have been upward of 18.5%

- Consequent reported PAT was down by 18.8% YoY to Rs. 1,138 crore vs. our expectation of Rs. 1,178 crore. PAT came in lower tracking lower other income pursuant to low yields on treasury book

- The company posted CFO of Rs. 1,545 crore for H1FY21, with Cash & Cash Equivalents as of September 2020 end at Rs. 16,240 crore

We would be coming out with a detailed report soon.

Shares of BAJAJ AUTO LTD. was last trading in BSE at Rs.2997.2 as compared to the previous close of Rs. 3016.35. The total number of shares traded during the day was 48079 in over 5332 trades.

The stock hit an intraday high of Rs. 3037.95 and intraday low of 2977. The net turnover during the day was Rs. 144708171.

Source : Equity Bulls

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