Bajaj Auto gains on record sales for October; stock up

NEW DELHI: Bajaj Auto Ltd gained over 2% on Wednesday after the country’s second largest bike maker reported its highest ever sales for the month of October.

The two-wheeler maker has announced that its total vehicle sales in October were up 7% at 395,274 units as against 370,816 units sold in the same month last year.

Total vehicle sales are up 15% at 2.65 million units for the first seven months (April-October) of the current fiscal, while exports surged by 33% to 983,446 units during the period.

Bajaj Auto said in a filing to the BSE that it has lost production of 25,000 motorcycles at its plant in Pantnagar due to the curfew imposed in early October, which constrained sales.

Last week, Goldman Sachs said it was positive on two-wheeler companies because of strong demand, pricing environment and export opportunities in Africa, South Asia and Latin America. It prefers Bajaj Auto because of its product strategy and experience.

“Recent 2QFY12 results of both market leaders Hero Motocorp and Bajaj Auto suggest that demand and pricing environment still remains strong, with an average 1.2 percent (quarter-on-quarter) margin expansion announced by both the companies,” it said.

The company expects exports to outgrow domestic sales going ahead as the firm seeks to cash in on vehicle demand in African and Latin American countries.

The two-wheeler maker expects to produce about 4.5 million vehicles in the current financial year that began April 1 with exports coming in at over 1.5 million units, its managing director Rajiv Bajaj said at a press conference in the month of October.

At 12:54 p.m., shares of the company were trading 1.2% higher at Rs 1736.15. The stock has touched a high of Rs 1748.35 and a low of Rs 1701. For the year the stock has awarded investors with a positive return of over 12%.