Pune-based two-wheeler maker Bajaj Auto’s net profit surged to ₹2,032 crore, a 38 per cent increase in the quarter that ended on December 31 as compared to ₹1,472 crore during the same quarter last year.

The  company witnessed a 0.59 per cent increase in its profit during the quarter as compared to the September quarter when it reported profit of ₹2,020 crore. 

Further, Madhur Bajaj, the company’s non-executive director who was associated with Bajaj Auto for 44 years, stepped down citing health reasons. The resignation will be in effect from January 24. Pradip Shah was reappointed as an independent director of the company with effect from April 1, 2024. 

The company’s revenue from operations grew by 30.55 per cent to ₹12,165 crore during the period from ₹9,318 crore posted in the same quarter last year. While a 12.24 per cent increase was witnessed with ₹10,838 crore in the previous quarter. 

“The domestic business delivers an even stronger quarter with volume-led revenue growth of nearly 50 per cent YoY. The performance in motorcycles particularly in 125 cc+, there is a sustained momentum on commercial vehicles and the steady ramp-up of the electric 2W and 3W portfolio. Pulsar continues to lead the way on competitive growth in the 125cc+ segment (6X of rest of industry) with its highest quarterly volume of 400K units,” the company said in an exchange filing. 

The company has seen a rise in demand for its electric two-wheeler Chetak and expects to cross 15,000 units in quarter 4. 

The company’s surplus cash stood at ₹18,439 crore at the end of the December quarter. 

Further at 12,00,997 units, there was a 22 per cent increase in volumes during the quarter that ended in December against 9,83,471 units sold in the same quarter last year. 

During the quarter the company witnessed green shoots in exports and saw a double-digit year-on-year revenue growth on dollar realisation and better product mix. 

“The quarter saw a slight uptick in billingvolumes - the step up in LATAM, Asia and premium bike exports offset the drag arising from Africa (notably Nigeria),” mentioned Bajaj Auto. 

Entry level impact

While the company is witnessing a surge in the portfolio of 125cc +, the overall entry-level segment is impacted.

“The overall motorcycle segment has growth, but the least growth has happened in the 100cc segment. The 12cc+ segment has grown in the middle teens with both urban and rural markets performing well. There continues to be a large 100cc segment, but I expect gradually the 125cc segment to become larger,” said Rakesh Sharma, Executive Director of Bajaj Auto.

Red Sea challenges

The Red Sea turmoil has impacted the operations of the company. 

“The impact of the Red Sea on the business is the increase in transit time particularly to Latin America and Africa, freight rates have doubled and the shipping opportunity is difficult. We have to wait and watch as to how long this will continue, the issue should be resolved by February-March,” added Rakesh Sharma.