Bajaj Auto Limited — Investor Meet, 04-02-2025: Analysts/Institutional Investor Meet/Con. Call Updates

1. **Financial Performance:** Bajaj Auto reported a strong Q3 FY25 with revenue of ₹12,807 crores, marking a 6% increase year-over-year, driven mainly by volume growth. EBITDA reached ₹2,581 crores, also up 6%, with margins sustaining at 20.2%. The PAT stood at ₹2,100 crores, highlighting consistent profitability despite challenges in export segments, particularly with KTM brand exports impacted by operational issues abroad.

2. **Future Outlook and Growth Drivers:** Management anticipates continued momentum in the export market, projecting over 20% growth in the near term, supported by strong recovery in Latin American and African markets. The focus remains on scaling its electric vehicle (EV) portfolio, integrating product innovations like the Chetak 35 series, and capitalizing on a growing demand for electric two and three-wheelers.

3. **Order Book and Operational Updates:** The company recorded significant milestones with robust volumes exceeding 1.2 million units and notable market share gains in the electric vehicle sector, reaching 22% of domestic revenue. The full rollout of Bajaj Auto Credit Limited was completed, enhancing financing capabilities alongside a strategy to expand electric and CNG models.

4. **Analyst Q&A Insights (Detailed):**

- **Revenue and Profitability:** Analysts inquired about export dynamics and the impact of a volatile currency. Management clarified that export growth is expected to remain strong, particularly in LATAM and Nigeria, despite geopolitical uncertainties.

- **Market Position and Competitive Landscape:** Questions regarding market share focused on the company's strategic retreat from aggressive pricing in the entry-level motorcycle segment to maintain profitability. Management confirmed a steady focus on the 125cc+ segment.

- **Operational Challenges or Risks:** The ongoing restructuring of KTM remains a concern, with analysts pressing for clarity on its timeline. Management indicated that performance could stabilize post-February.

- **Capex and Capital Allocation:** Bajaj Auto's continued investment in electric technologies and financing capabilities were emphasized, with cash reserves at ₹15,000 crores supporting future growth initiatives.

- **Strategic Priorities and Long-Term Vision:** Analysts probed into long-term strategies around the electrification movement and product diversification. Management reiterated their commitment to capturing market share in the upper segments while expanding their EV offerings.

5. **Market or Regulatory Updates:** No significant regulatory updates were highlighted; however, management noted the impact of upcoming compliance changes associated with the OBD-2B emissions guidelines on pricing strategies.

6. **Strategic Focus Areas:** Key themes include a commitment to innovation, particularly in the EV space, maintaining competitive pricing strategies while ensuring profitability in product offerings across all segments.

7. **Investor Insight:** The company's solid financial health, coupled with robust growth potential in exports and electric vehicles, suggests a favorable outlook, aligning with a ‘buy’ position. Investors should, however, remain mindful of external macroeconomic challenges and regulatory shifts that could impact future performance.