Bajaj Auto Q1 Review – Margin Pressure To Continue: Systematix

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Bajaj Auto Ltd.’s Q1 FY22 Ebitda margin of 15.2% was below consensus and our estimates as gross margin contracted 120 basis points sequentially due to raw material inflation (500bps over the last 12 months).

Bajaj Auto expects commodity pressure to continue in Q2 FY22; it has taken another price hike to offset the impact partially.

As highlighted in our channel check note, the management confirmed that recovery in the domestic two-wheeler industry remains muted, unlike last year when demand surprised positively after lockdown 1.0.

The exports momentum remains strong, especially in the Africa and Latin America markets.

Three wheelers have started to gain traction after more than a year.

Click on the attachment to read the full report:

Systematix Bajaj Auto – Q1FY22 Result Update.pdf


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