Bajaj Auto Ltd.|Q3FY15| EBITDA margin and PAT above expectation | Maintain BUY rating on the stock with target price of Rs. 2,840. :: IndiaNivesh

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Bajaj auto Q3FY15 numbers were above our expectation. Reported PAT stood at
Rs. 8.61 bn vs our expectation of Rs. 7.9 bn on the back of lower RM cost along with
higher realization. Revenue increased by 10% YoY (down 5% QoQ) to Rs. 55.2 bn
(above our expectation of Rs. 54.8. bn) due to higher than expected average
realization led by higher exports and 3W sales. Exports continue to do well with
31% YoY volume growth to 0.490 mn units as compared to 13% de-growth in
Domestic volumes. Average net realization went up by 11% YoY and 2% QoQ to
Rs 56068 due to favorable currency and better product mix. EBITDA margin expanded
by 279 bps QoQ to 21.7 %( vs. our expectation of 19.2%) driven by higher net
realization and favorable currency movement. Management believes export growth
would be continuing on the back of strong growth in Iran and African market; expect
18-20% volume growth for FY15 (9MFY15 growth is 22%). The company is going to
launch four new products over four months. The company is set to launch its flagship
motorcycle- Pulsar 200SS in India by the end of March 2015, which will help to the
company to regain is domestic market share. We will come with the detailed analysis
after the Con-call scheduled dated 16th January, 2015.

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http://www.indianivesh.in/Admin/Upload/635572714141697500_Bajaj%20Auto%20_Q3FY15%20First%20Cut%20Analysis.pdf