Shares of Bajaj Auto dropped over 10% to Rs 10,414 on October 17 after the company reported lower-than-expected profits in Q2 FY24-25. Despite a 9% increase in standalone net profit to Rs 2,005 crore, the results fell short of analyst estimates. Revenue rose 22% to Rs 13,127 crore. The company also revised its two-wheeler sales growth forecast in India to 5%, at the lower end of its previous 5-8% estimate.
Bajaj Auto Shares Plunge After Weak Q2 Performance
The stock fell amid concerns over weaker-than-expected sales during the festive season. Analysts at Emkay Global downgraded Bajaj Auto to ‘Sell’, revising the target price to Rs 9,500. Citi also issued a ‘Sell’ rating, setting a target price of Rs 7,800, citing a slight miss in Average Selling Prices (ASPs) and gross margins.
However, HSBC and Jefferies issued bullish calls. HSBC set a target price of Rs 14,000, noting Bajaj Auto’s growing market share and EV penetration. Jefferies highlighted growth potential in exports and increasing demand for two-wheelers in India.
Auto Sector Faces Festive Season Concerns
The cautious outlook also impacted competitors, with shares of Hero MotoCorp, Eicher Motors, and Maruti Suzuki falling due to concerns over a potential slowdown in consumer demand during the festive season.