Bajaj Auto share price trades lower ahead of Q2 earnings

Shares of the two-and-three-wheeler maker Bajaj Auto were trading 1% lower on Thursday as the firm is scheduled to announce its Q2 earnings today.

The company is likely to register 5% in revenue drop amid a heavy decline in sales volumes and higher tax cost for the July-September quarter.

Bajaj Auto share price touched an intraday low of Rs 2,977, falling 1.3% as against the closing price of Rs 3,016.35 on BSE. The stock also touched an intraday high of Rs 3,037.95, also its opening price. Bajaj Auto stock price has fallen after 2 days of consecutive gain

Bajaj Auto stock has fallen 6% since the beginning of the year and 1.41% in the last week. The automaker's market capitalisation stood at Rs 86,318.18 crore. The stock trades higher than 20, 50, 100 and 200-day moving averages but lower than 5-day moving averages.

As per HDFC Securities, Bajaj Auto is expected to post 8% YoY decline in net sales to Rs 7060 crore on the back of 10% YoY decline in volumes at 10.5 lakh units. Company's Operating margins at 15.2% are likely to expand 190bps QoQ (minus140bp YoY). PAT is expected to jump 2 times sequentially at Rs 1040 crore (minus 26% YoY). The brokerage added that recovery trends in the Indian market would be key monitorable for investors to the lookout.

Kotak Institutional Equities said in its note, "We expect revenues to decline by 5 per cent YoY led by 10 per cent YoY decline in volumes and 6 per cent YoY increase in ASPs in Q2FY21".

Prabhudas Lilladher said, "The volume mix has been unfavourable with a lower share of premium motorcycles and 3-wheeler resulting in a decline in the realisation by 1 per cent QoQ (up 5 per cent YoY)."

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