Rajiv Bajaj: Revving up

Mumbai, May 11: Bajaj Auto Ltd today surprised analysts with a better-than-expected result on the back of rising motorcycle sales.

The sales net of excise was Rs 1773 crore in the quarter ended March 31, a 31 per cent rise compared with the corresponding period of last year. Profit after taxes at Rs 240 crore was 22 per cent higher than the corresponding quarter last year.

The company said annual revenues at Rs 6335 crore for 2004-05 is 20 per cent higher than the previous year, while net profit of Rs 767 crore is a record amount.

Most of the sales occurred in the higher price points for Bajaj, which explains the attractive operating margins, analysts said.

Bajaj Auto managing director Rajiv Bajaj said the focus will be to grow in some larger markets in Southeast Asia, where the two and three wheelers are as popular as in the domestic market.

On three-wheelers, Bajaj admitted that the concept is too old and the company would review and renew the product.

On Tata’s ACE, the 0.75-tonne truck which aims to wean away a part of the booming three-wheeler goods carrier, he said, “It is far away from our three-wheelers.”

The company is developing a four-wheeler goods carrier and said a two- and three-wheeler maker is best positioned to make a people’s vehicle. On the Rs 1 lakh car, Bajaj said, “We don’t think it exists.”

Kawasaki deal

Bajaj Auto has indicated that it will partner with Kawasaki to enter the Asean markets faster.

“If we had to enter the Asean markets on our own, it would take us more than 10 years to make an impact. All we are saying is that Kawasaki will be our front-end, and we will supply the products for gaining a presence in Indonesia, Thailand, Malaysia and the Philippines. Such an arrangement will save time and money for us,” Bajaj said.

Reports also suggest that Bajaj Auto is in talks with a few Taiwanese companies to gain an entry in the Chinese markets.

Kawasaki is ideally suited as the company is present in the bigger motorcycle segment. “It is true that we are developing bigger motorcycles,” Bajaj added.

The next launch will be the Eliminator cruiser re-christened as Avenger and powered by the Pulsar’s 180 cc engine. The bike will have a lower price tag of Rs 60,000.

On scooters, where Bajaj Auto has a negligible presence now, the managing director said the scooter segment has slowed down in India. However, Bajaj plans to launch three scooter models next year.