Bajaj Auto share price tanked 1.41% to Rs 4,281 today after the company’s net profit fell 2.5% on-year to Rs 1433 crore. Analysts had predicted a much bigger fall. The company’s revenue for the January-March quarter stood at Rs 8904.7 crore, up 12% on-year, supported by the sustained momentum of the domestic business that delivered strong volume-led revenue growth. Bajaj Auto shares have risen nearly 13% in the past one month and 11% in the last one year. Meanwhile, the company’s board has approved the reappointment of Rakesh Sharma as a whole-time director for another five years, effective Jan. 1, 2024.
Brokerage call: Should you buy, sell or hold Bajaj Auto shares?
HDFC Securities: Reduce – Target Price: Rs 4028
“We believe that once volumes revive, even the current favourable mix will normalise. This coupled with the slight under-recovery of the recent cost inflation is likely to keep margins under pressure from here on. At 17.6x FY25E, the stock appears expensive. Reiterate Reduce with revised TP of Rs 4,028 (earlier Rs 3,857); as we roll forward to FY25 earnings (from Sep 24 earlier)—core business valued at an unchanged 16x multiple,” said analysts at HDFC Securities.
Nuvama: Hold – Target Price: Rs 4400
“Bajaj Auto’s underperformance is likely to persist owing to its weak presence in scooters in the domestic market, not to mention its large exposure to overseas markets. On balance, we retain ‘HOLD’ with a target price of Rs 4,400 (earlier rs 4,160) based on an uptick in FY24E/25E EPS by 6%/5%,” said analysts at Nuvama Research.
