Financial Daily from THE HINDU group of publications
Saturday, May 20, 2006
Financial Daily from THE HINDU group of publications Saturday, May 20, 2006 |
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Corporate Results
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Two/Three Wheelers Bajaj Auto Q4 net revs up 69 pc Our Bureau
Mumbai , May 19 Bajaj Auto Ltd has reported a 69 per cent increase in its fourth quarter net profit at Rs 346.97 crore against Rs 204.63 crore in the previous corresponding period. While higher sales and value-added products contributed to profits, the year-ago quarter also had an outgo of Rs 35.8 crore as adjustments on account of write down of deferred tax assets. Total income for the quarter was Rs 2,268.95 crore (Rs 1,761.15 crore). Although the company's performance was better than expected, its shares on BSE fell by Rs 62.25 to Rs 2,949.80 on account of the overall slump in the market. The board has recommended a dividend of Rs 40 per share. For the year, Bajaj Auto reported a 47 per cent increase in net profit at Rs 1123.3 crore (Rs 765 crore). Turnover net of excise was Rs 8,106.4 crore (Rs 6,322.8 crore). EBITDA margin improved 2.2 per cent to 17.9 per cent during the year. The company ruled out plans to raise prices of its vehicles. "Prices of all metals are going up but margins are good now and we will be able to absorb the increase in raw material prices," said Mr Sanjiv Bajaj, Executive Director, Bajaj Auto.
Overseas foray
Margins, according to Mr Bajaj, are much higher in exports. The company, which is present in a number of countries, including Sri Lanka, Egypt, Mexico and Indonesia, is planning to enter Nigeria this fiscal. "We are testing our 100 cc motorcycle in Nigeria where these vehicles are used as taxi. We have a challenge there. China supplies two-wheelers at prices between $350 and $450, which is ridiculously low. We have to price our vehicles competitively,'' he said. Barring Nigeria, Bajaj Auto's margins in other export markets are much higher than in the domestic market. Mr Bajaj said the company plans to launch CNG three-wheelers in Jakarta in June 2006. It has closed a deal for two-wheelers with its manufacturing partner. The company also plans to re-enter Iran and sell motorcycles through Fars Motors. "It is a good opportunity to grow in the West Asian market,'' he said. Bajaj Auto has made an entry into some of the South American countries, including Columbia, Guatemala, Peru, Uruguay and Mexico.
More Stories on : Two/Three Wheelers | Bajaj Auto Ltd
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