Shares of Bajaj Auto plummeted 8% after the company reported its second-quarter results, which fell below analysts’ expectations.

What Happened: Bajaj Auto’s standalone net profit rose 9.20% year on year to ₹2,005.04 crore but missed analysts’ expectations of a ₹2,213.6 crore net profit.

The Pulsar maker's revenue increased 21.81% year on year to ₹13,127.47 crore, falling slightly below the analysts’ estimates of ₹13,289.56 crore. The company’s EBITDA came in at ₹2,653 crore.

Bajaj's Triumph delivered a 50% quarter-on-quarter increase in volume with 10,000 units sold domestically and a total of 16,500 units overall. Additionally, commercial vehicle sales reached an all-time high of 140,000 units for the quarter.

Brokerage Reactions: Citi had a “sell” call on the stock with a target price of ₹7,800. The company’s results were slightly below its estimates due to a minor shortfall in average selling prices and gross margins.

The brokerage said it was surprised by the company’s outlook for festive demand, noting that industry volumes were up only 1%-2% compared to last year.

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Jefferies said that Bajaj’s Q2 EBITDA and recurring profit after tax rose 21%-24% YoY but were about 3%-4% below estimates. Bajaj anticipates only 3%-5% growth in motorcycle sales during the festive season but remains positive about ongoing quarter-on-quarter improvements in exports, it noted. The brokerage had a “buy” recommendation with a target price of ₹13,400.

CLSA said that EBITDA margin was 20.2%, up 41 basis points year on year but flat quarter on quarter, below the estimated 21%. This was driven by a 130 basis point decline in gross margin, likely due to a roughly 300 basis point increase in the electric two-wheeler volume mix.

Morgan Stanley had an “overweight” call on Bajaj Auto with a target price of ₹11,389. According to Bajaj, retail sales in the early part of the festive season were slower than anticipated. The company expects industry growth to be around 5%, compared to market estimates of 8% to 10%, the brokerage noted.

Kotak Securities maintained a “sell” rating with a target price of ₹7,225 after a peak start to the festive season. Revenue came in 2% below the brokerage’s estimates with profit and EBITDA missed estimates by 3% and 5%, respectively.

Kotak expects a sequential recovery in the company’s export segment volumes. It now expects Bajaj’s earnings per share to grow 7.1% in FY26 and 11.4% in FY27.

Price Action: Bajaj Auto’s shares were down 7.45% to ₹10,751.35 on Thursday morning.

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