Why Bajaj Auto Shares Are Slumping After Q4-Print

Bajaj Auto‘s share price’s dream run gets halted as the company posted its Q4 results.

What Happened: The two-wheeler major’s revenue from operations went up 12% year-over-year to ₹8,905 crore. The company attributed the uptick in revenue to “the sustained momentum in the domestic business that delivered strong volume-led revenue growth.”

EBITDA for the quarter ended March stood at ₹1,718 crore, up 26% YoY. EBITDA margin expanded 220 basis points to 19.3% in the March quarter. Net profits, however, were down 2% YoY at ₹1,433 crore.

However, investors do not seem impressed by the numbers, as the stock slumped around 1% at open. Prior to the slump today, Bajaj Auto’s share price had been hitting all-time highs for two straight sessions ahead of the results.

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The estimate beating numbers seems to have impressed analysts as well. Morgan Stanley maintained its ‘overweight’ rating for the stock raising the price target to ₹5,063 from ₹4,486. JP Morgan also maintained its ‘overweight’ rating on the stock with a price target of ₹5,150.

However, global brokerage firm CLSA downgraded the stock’s rating to ‘outperform’ from ‘buy’ with a price target of ₹4,659. The firm said that while the Q4 numbers beat expectations it expects the company’s two-wheeler exports growth to remain modest in FY24 (April 2023- March 2024).

Price Action: Bajaj Auto share price was down 1.18% to trade at ₹4,291.40 as the markets opened for business today.

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