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Bajaj Auto's stock experienced a decline of over 2% following the release of its Q4 FY25 financial results. Despite reporting stable margins and a rise in revenue, investor sentiment was dampened by concerns over domestic market share losses in the 125cc motorcycle segment and potential disruptions in electric vehicle (EV) production due to supply chain challenges.
In the fourth quarter of FY25, Bajaj Auto reported a consolidated net profit of ₹1,802 Crores, marking a 10% decrease compared to ₹2,011 Crores in the same period the previous year. However, revenue from operations increased by 9% year-on-year to ₹12,646 Crores, driven by strong export performance and a favorable product mix.
Metric |
Q4 FY25 (Crores) |
Q4FY24 (Crores) |
Change (%) |
|---|---|---|---|
Revenue from Operations |
₹12,646 |
₹11,555 |
+9% |
Net Profit (PAT) |
₹1,802 |
₹2,011 |
-10% |
EBITDA |
₹2,451 |
₹2,312 |
+6% |
EBITDA Margin |
20.2% |
20.0% |
+0.2 pp |
Note: The EBITDA margin remained stable, reflecting effective cost management.
Bajaj Auto faced a decline in domestic market share within the 125cc motorcycle segment during Q4 FY25. The company's share in this segment dropped to 24%, raising concerns among investors about its competitiveness in a crucial market category.
Management has acknowledged the issue and plans to introduce new models to regain market share in the 125cc+ segment by the end of FY26.
Bajaj Auto has raised alarms over potential disruptions in its electric vehicle production starting July 2025, attributing this risk to China's export restrictions on rare earth magnets—essential components for EV motors. The company emphasized that inventories are depleting, and without a resolution, EV output could be significantly affected.
According to the company’s internal projections, Bajaj Auto expects a 5–7% growth in motorcycle sales and a 20–25% increase in electric scooter volumes for FY26. These are management estimates and are subject to market conditions and external variables. The company aims to strengthen its position in the 125cc+ motorcycle segment and expand its EV portfolio, including the Chetak scooter, which has seen a rise in market share.
The Board of Directors has recommended a dividend of ₹210 per share for FY25, reflecting the company's commitment to shareholder returns despite current challenges. The securities quoted are for illustration only and are not recommendatory.
Q4 FY25 net profit declined by 10% YoY to ₹1,802 Crores, while revenue increased by 9% to ₹12,646 Crores.
Domestic market share in the 125cc segment fell to 24%, prompting strategic plans for recovery.
Potential EV production disruptions loom due to China's export restrictions on rare earth magnets.
The company forecasts growth in both motorcycle and electric scooter segments for FY26.
A dividend of ₹210 per share has been proposed for FY25.
Bajaj Auto's Q4 FY25 performance highlights the company's resilience in revenue growth amidst profit pressures and market share challenges. While external factors like supply chain constraints pose risks, strategic initiatives aimed at product diversification and market expansion may support future growth. Investors should monitor the company's execution of these strategies and developments in the EV supply chain landscape.
This content is for informational purposes only and the same should not be construed as investment advice. Bajaj Finserv Direct Limited shall not be liable or responsible for any investment decision that you may take based on this content.
Sources
Economic Times — Bajaj Auto Q4 Results: Cons PAT falls 10% YoY to Rs 1,802 crore; Rs 210 per share dividend announced https://economictimes.indiatimes.com/markets/stocks/earnings/bajaj-auto-q4-results-cons-pat-falls-10-yoy-to-rs-1802-crore-rs-210-per-share-dividend-announced/articleshow/121492050.cms
LiveMint — Bajaj Auto flags threat of production cuts by July if rare earth magnet issue remains unresolved
https://www.livemint.com/companies/news/bajaj-auto-flags-threat-of-production-cuts-by-july-if-rare-earth-magnet-issue-remains-unresolved-11748530471032.html
Autocar Professional — Bajaj Auto Sees India Motorcycle Sales Up 5-7% in FY26; E-Scooters to Grow 20–25% https://www.autocarpro.in/news/bajaj-auto-sees-india-motorcycle-sales-up-5-7-in-fy26-e-scooters-to-grow-20%E2%80%9325-126685
Business Standard — Bajaj Auto Q4 results: Net profit falls 10% to ₹1,801 cr, declares dividend
https://www.business-standard.com/companies/news/bajaj-auto-q4-results-net-profit-falls-10-to-1-801-cr-revenue-up-8-5-125052901614_1.html
Moneycontrol — Bajaj Auto shares slip 2% after Q4 results; should you buy, sell or hold? https://www.moneycontrol.com/news/business/earnings/bajaj-auto-shares-in-focus-as-q4-profit-tops-estimate-should-you-buy-sell-or-hold-13067894.html
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