Bajaj Auto profit more than halved in last 3 months but Pulsar 150 cc helped gain market share
- Bajaj Auto reported around 53% fall in its net profit at ₹528 crore for the first quarter ended June 30.
- The company said that its total revenue from operations was down 60% to ₹3,079 crore.
- The share price of auto major was down 2% after the company declared the results.
AdvertisementIt would have been a totally forgettable quarter for Bajaj Auto but there was a silver lining. India's second largest two wheeler maker now has a nearly 60% market share in sports bikes, thanks to a sustained demand for the iconic Pulsar's 150 cc variant.
Overall, the company's profit fell about 53% fall in its net profit at ₹528 crore, and the revenue from operations was down 60% to ₹3,079, for the first quarter ended June 30, compared to the same period last year.
|Bajaj Auto||Q1 Growth (YoY)|
“Q1 FY21 has been an extremely challenging quarter due to the unprecedented COVID-19 pandemic. Lockdown and other containment / precautionary measures have resulted in disrupted supply lines and a sharp decline in overall demand,” the company said in its filing to stock exchanges.
The street was expecting a 42% fall in its profit. The share price of auto major was down 2% as the earnings were worse than estimates.
The company further added that it increased its overall share in the domestic motorcycle market to 20.7% at the end of June quarter against 18.5% in the previous quarter. The biggest spike came from the higher-priced segment (150 cc and above)
However, its three-wheeler market share dropped to 23% against 44% in last quarter largely due to the “lack of commuting demand due to the pandemic which led to a reduction of segment contribution of small three-wheeler passenger carrier,” it said.
The outlook for the auto industry is pretty bleak as of now, and Bajaj wasn’t immune to it either. However, its great rural penetration and export market cushioned its business. According to Bajaj, “the month of June 2020 witnessed a decent recovery and performance of Bajaj Auto was better than the industry.”
When other companies clocked zero sales in the month of April, Bajaj was also the only company to export nearly 32,009 units, though it was down 91% year-on-year.
SEE ALSO: Bajaj Auto shareholders will look for cost controls and CEO confidence as sales remain a lost cause due to the lockdown
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