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Bajaj Auto’s profit grew 4.6 per cent year-on-year to ₹901 crore in the quarter ended December 2015. But the growth did not come from its core operations. A doubling of other income to ₹199 crore due to forex gains and a flat tax expense of ₹395 crore in this quarter led to the profit growth.
The company’s operating profit dropped about 5 per cent compared with the December 2014 quarter, impacted by lacklustre sales, both in the domestic and export markets. But despite a 3.3 per cent fall in overall volumes, the company managed to contain the drop in net sales at 1 per cent Y-o-Y to ₹5,463 crore. Higher realisations from sale of premium bikes, such as the Avenger series and the Pulsar RS200 in the domestic market helped on this front. The operating margin for this quarter was 21 per cent — the same level as the year-ago period.
Export volumes and realisations could slow further (40-45 per cent of revenues). Its key export markets, such as Nigeria and Egypt are facing tough times due to the fall in oil prices.
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