KR Choksey has given Accumulate recommendation for Bajaj Auto with a target price of Rs. 4352 in its research report issued on Jul 27, 2021
KR Choksey’s research report on Bajaj Auto
For Q1FY22, Bajaj Auto reported total revenue from operations of INR 73,860 Mn, growth of 140% YoY (-14% QoQ). Domestic Volumes grew by 84.2% YoY at 342,552 units whereas Export volume grew by 160% YoY at 556,753 units. As the quarter witnessed sharp increase in the input cost, EBITDA margin contracted by 270 bps QoQ to 15.5% (+165 bps YoY), EBTIDA for the quarter stood at INR 11,177 Mn (+174% YoY). For the quarter, Net Profit stood at INR 11,699 Mn (+122% YoY), with NPM at 16.2% (-168 bps YoY).
We continue to assign a P/E multiple of 24x on FY23E EPS of INR 180 per share and maintain our Target Price of INR 4,352 per share; implying an upside potential of 13.4% over the CMP. Accordingly, we reiterate a “ACCUMULATE” recommendation on the shares of Bajaj Auto Ltd.