Buy Bajaj Auto: target of Rs 11,950: ICICI Securities

Moneycontrol • 4 days ago

Original source

Key Investment Pillars

  • Bajaj Auto's (BJAUT) Q2FY27 revenue was ahead of estimates, driven by strong domestic demand and robust exports, with the company expecting double-digit growth in the 2W industry in Q3.
  • Margins remained stable at 20.9% despite commodity inflation pressure, with the company implementing price hikes to mitigate the impact.
  • The EV business is becoming increasingly important, with the company's EV portfolio turning margin-accretive and plans to add new exclusive stores.
  • The company is prioritizing its premium portfolio and plans to introduce new brands in the 125-250cc segment.

Thesis Validation Checklist

  • Investors should watch for demand trends in the domestic 2W market, exports growth, and margin expansion driven by price hikes and operating leverage.
  • The company's ability to improve its market share in the 125cc+ motorcycle segment and the success of its new launches will be key monitors.
  • The EV business's continued growth and margin accretion will also be important to track.