Bajaj Auto shares fall 5% after monthly sales miss estimates

The Bajaj Group company missed estimates, with total sales rising 1.7% year-on-year at 4.79 lakh units, compared to the 4.71 lakh units in the same month last year. According to a CNBC-TV18 poll, Bajaj Auto was expected to report total sales at 4.89 lakh units.

The total sales comprise of domestic sales of 3.03 lakh units, down 8% year-on-year, and exports of 1.75 lakh units, up 24% year-on-year.

In the domestic commercial vehicles segment, the automaker reported a decline of 6% year-on-year in October 2024 whereas exports during the month grew 46%.

For Bajaj Auto’s domestic two-wheelers segment, the company reported a decline of 8% year-on-year in October 2024 whereas exports during the month grew 22%.

Speaking to CNBC-TV18, Bajaj Auto Executive Director Rakesh Sharma mentioned that October is a destocking month for the company from a wholesale perspective.

Retail sales, however, are up 30% in October, indicating strong growth. “In our target segment of 125cc and above, we have seen a 20% increase in retail sales.”

Bajaj Auto Managing Director Rajiv Bajaj, in a recent interaction with CNBC-TV18, said he expects the company’s sales to reach around 4.5 million by the end of the financial year 2025.

Bajaj suggested that the total sales could be even higher due to a significant rise in exports, which are estimated to increase from 140,000 to between 170,000 and 180,000 units per month.

He had highlighted that with new models like the Pulsar 125 being introduced and increased production of the Freedom and Chetak, Bajaj Auto could potentially reach around 4.7 million vehicles for the year.

Additionally, Bajaj said that he sticks to his long-term share price target of ₹20,000 for Bajaj Auto.

Reflecting on the recent decline in Bajaj Auto shares after Q2 results, Bajaj expressed uncertainty about the reasons for the correction. However, he noted that a stock that has grown by almost 100% in 12 months is bound to correct at some point.

“As far as I am concerned, I stand by my projection of ₹20,000 as the long-term target price in my head. Not that I am an expert on this subject but more importantly, I am certain that I am going out and buying some stock because something that corrected 20%, perhaps based on a somewhat temporary understanding of an evolving situation, presents a nice upside in the weeks to come,” he stated.

At 9:35 am, Bajaj Auto shares traded in the red at ₹9,410.60, lower by 4.71%. Despite the decline, the stock has risen over 40% so far this year.