Bajaj Auto earnings beat expectations: Marwadi Shares & Finance

MUMBAI: Marwadi Shares & Finance is of the view that Bajaj Auto’s earnings are above expectations and the company has benefited from rupee depreciation on exports revenue.

“Bajaj Auto reported 3Q FY12 sales numbers at Rs 52,673 million, 2% above consensus and up 21% yoy, driven by higher volume growth (up 14% yoy) and realizations (up 2% yoy). Exports came in at Rs. 17,110 million up 51% yoy driven by strong volumes and favorable currency impact in the quarter.

EBITDA margins came in at 21% in 70bps above consensus expectation and 90bps higher sequentially. Adj EPS came in at Rs. 29.0/share in line with expectation, up 28% yoy and 4% sequentially.

The company has clearly benefited from rupee depreciation on exports revenue, which has offset the slowdown in the domestic side and that in our view increases EBITDA margins by 100-125bps,” the report said.

The brokerage has a ‘Buy’ recommendation on the stock with target price of Rs 1922 per share.