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Bajaj Auto profit off track

Mumbai, July 14: Bajaj Auto Ltd the country’s second-largest motorcycle maker posted a 21 per cent rise in net profit for the first quarter ended June 30 at Rs 711 crore against Rs 590 crore in the corresponding period last year but fell short of analyst estimate of Rs 750-crore net profit.

The Pune-based company’s margins were hit by high raw material and component costs. The EBITDA (earnings before interest, tax, depreciation and amortisation) margin stood at 19.1 per cent, lower than the 19.5 per cent estimated by analysts.

Material costs, as a percentage to operating income, rose to 72.6 per cent from 71.2 per cent in the corresponding quarter of the last financial year.

Turnover increased 22 per cent to Rs 4,850 crore from Rs 3,972 crore in the same period last year. In volume terms, sales grew to 1,092,815 units against 928,336 last year, a growth of 18 per cent.

Motorcycle sales stood at 963,051 units (828,391), a rise of 16 per cent, while that of commercial vehicles showed a rise of 30 per cent at 129,764 units. The first quarter of 2011-12 witnessed the highest sales volume both for motorcycles and commercial vehicles. Sales of the Pulsar averaged 75,000 units per month and that of the Discover around 135,000 units.

Exports grew 40 per cent, and expenses on raw materials jumped to Rs 3,175 crore from Rs 2,556 crore in the corresponding quarter last year.

The domestic automobile industry has witnessed a slowdown in recent months because of high interest rates and fuel price hike.

However, analysts are of the view that the two-wheeler segment is relatively more insulated as the models are cheaper and fuel-efficient.

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