Bajaj Auto Q3 results today: What to eye in the fineprint; how to trade the stock?

Bajaj Auto Ltd is scheduled to release its third quarter earnings later today, as Dalal Street investors are optimistic of the company putting up a good show given strong volume growth and operating leverage benefits.

Aided by the strong festive demand, easing cost pressures, and the share buyback plan, shares of the two-wheeler major have rallied more than 31% in the last three months and even scaled a lifetime high last week.

If earnings turn out to be better than expected and if the management offers an optimistic guidance, then the stock could extend its upmove.


Read more: Bajaj Auto Q3 preview: PAT may surge 33% YoY on strong volumes, price hikes

Following are the key monitorables for Dalal Street investors.

Core Earnings

Bajaj Auto’s net profit is seen rising a sharp 33.3% year-on-year (YoY) to Rs 1,987 crore, the average of estimates given by eight brokerage firms showed.

Revenue is seen rising 29% YoY to Rs 12,039 crore, and operating profit may increase 32% to Rs 2,341 crore.

Volumes

For the quarter ended December, Bajaj Auto reported a 32% YoY growth in sales volumes at 12,00,997 units, but this was largely on the back of strong momentum in the domestic market.

Analysts will, therefore, eye trends in exports, which is a key segment for the company, and an outlook for the ensuing quarters.

Read more: Tech Mahindra Q3 result preview: Revenues to decline QoQ; deal wins to be muted

Guidance

Price hikes have likely driven the revenue and operational performance of the company in the December quarter. Analysts will watch out for an outlook on the pricing and raw material trajectory for the coming quarters.

Stock Talk

The current trajectory for the stock remains positive while it’s trading in the range of Rs 6,900-7,400. The stock can maintain its bullish bias above Rs 6,600 level and upside potential can be towards Rs 7,600 level, Emkay Global said.

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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)