Bajaj Auto will report its fourth-quarterly earnings on Friday and analysts expect the two-wheeler maker to post a mixed set of results.
- The analysts are expecting a mixed quarter. A CNBC-TV18’s poll sees revenue growth of 6.5 percent, driven by a couple of factors such as the volume growth, which has been very strong.
- Bajaj Auto has outperformed its peers and in the March quarter, it had a volume growth of close to about 14 percent. All that will not drive into the topline because the product mix for Bajaj Auto has been weakening which is putting pressure on the company’s average realisation as well as the selling price. The average selling price has also come down on a quarter-on-quarter (QoQ) basis which is why a 6.5 percent topline growth is expected.
- The decline in realisation and weaker product mix is also weighing on the company’s margins. So margins, according to the poll, will be significantly lower from 19.5 percent last year to 15.9 percent in Q4 and profits will be absolutely flat.
- The key to track will be their margin performance because margins for Bajaj Auto have been declining for the last three consecutive quarters.