Bajaj Auto margin slips in Q3, shares fall

MUMBAI Wed Jan 16, 2013 3:28pm IST

Newly built motorbikes are seen at the Bajaj Auto Ltd. plant in Pune, about 130 km (82 miles) from Mumbai August 9, 2007. REUTERS/Punit Paranjpe/Files

Newly built motorbikes are seen at the Bajaj Auto Ltd. plant in Pune, about 130 km (82 miles) from Mumbai August 9, 2007.

Credit: Reuters/Punit Paranjpe/Files

Related Topics

Stocks

   

MUMBAI (Reuters) - Bajaj Auto Ltd(BAJA.NS) saw its prized profit margin slip in the quarter to December, sending its shares down despite hitting estimates with a 3 percent rise in quarterly earnings, as rising costs and a fall in exports crimped earnings.

Bajaj, India's second largest motorcycle manufacturer by sales volume, saw its EBITDA (earnings before interest, tax, depreciation and amortisation) margin - trumpeted as the best in the industry - fall to 20.1 percent from 21.0 percent in the same quarter a year ago, as lucrative export sales slipped 2 percent.

Shares in the automaker, also the world's largest manufacturer of motorised three-wheeled vehicles, fell as much as 2.7 percent after the results were released.

Bajaj's stock recovered slightly and was trading down 2 percent at 3:27 p.m., on a Mumbai market down 0.8 percent.

EBITDA margins were seen declining 50 basis points, according to a recent report by Anand Rathi Shares & Securities in Mumbai.

"In other international markets (excluding Africa), demand remained subdued," Bajaj said in a statement.

In India, where Bajaj sells around 70 percent of its motorbikes, demand has slumped due to high interest rates and rising ownership costs.

The country's automotive industry association this month cut its motorcycle sales growth forecast for the financial year that ends in March to 3-5 percent, from 5-7 percent earlier.

Net profit for the Oct-Dec quarter rose 3 percent to 8.19 billion rupees, in line with analysts' estimates, as net sales rose 10 percent to 53.1 billion rupees.

(Reporting by Henry Foy; Editing by Anand Basu and Daniel Magnowski)

FILED UNDER:
  • Most Popular
  • Most Shared

Market Eye

REUTERS SHOWCASE

Intel's Valuation

Intel's Valuation

Intel could rise 30 percent over next two years - Barron's.  Full Article 

Canonisation

Canonisation

Pope declares sainthood of two Indians, four Italians.  Full Article 

Stake Sale Strike

Stake Sale Strike

Coal India trade unions call off strike in victory for Modi.  Full Article 

Interview with Bulgari CEO

Interview: Bulgari CEO

Bulgari CEO: we shouldn’t have left India so we’re back.  Full Article 

Formula One

Formula One

Hamilton takes second F1 title in style.  Full Article 

Available For Remake

Available For Remake

Bollywood finally wants to pay the price for remakes.  Full Article 

Davis Cup

Davis Cup

Vintage Federer seals first Davis Cup for Switzerland.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage