BAJAJ FINSERV DIRECT LIMITED
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Bajaj Auto Shares Dip Amid Q4 FY25 Profit Decline and Market Share Concerns

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Roshani Ballal

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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.

Q4 FY25 Financial Overview

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.

Key Financial Metrics

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.

Domestic Market Share Challenges

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.

Supply Chain Risks Impacting EV Production

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.

FY26 Outlook and Strategic Initiatives

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.

Dividend Declaration

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.

Key Takeaways

  • 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.

Disclaimer

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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Hi! I’m Roshani Ballal
Blogger

Roshani has over 6 years of experience and has honed her skills in performance content marketing in the financial domain. She loves diving into research and has crafted and overviewed creative copies, long-form financial content, engaging blogs, and informative articles. She specialises in delivering user-oriented content and solving problems through various content formats. On the side, Roshani enjoys writing poems-that's how she stays creative when she is not crunching numbers.

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