Bajaj Auto skids 3% after dismissing price cut claims on Freedom & Pulsar

Bajaj Auto shares slipped 2.7 per cent on Thursday and logged an intraday low at Rs 8,751 per share. The downward movement in the stock came after the company clarified that a brokerage report regarding the sales volumes and price cuts of ‘Freedom’ and select ‘Pulsar’ variants does not present an accurate picture.

 

Around 12:39 PM, Bajaj Auto's share price was down 2.16 per cent at Rs 8,805.05 per share. In comparison, the BSE Sensex was up 0.69 per cent at 81,514.89. The market capitalisation of the company stood at Rs 2,45,887.72 crore. The 52-week high of the stock stood at Rs 12,772.15 per share and 52-week low of the stock stood at Rs 5,990.05 per share.

 

Through a regulatory filing, Bajaj Auto clarified that the dispatch number of Freedom 125, a motorcycle produced by the company, is stated incorrectly at 80,000.

 

As of November 30, 2024, the company has actually billed 67,000 units to dealers, with 40,000 units having been retailed during this period, of which 33,000 units were registered on the Vahan portal.

 

Further, the Freedom portfolio currently has three variants in the market – top, base, and Mid. In effect, 72 per cent of the Freedom portfolio has not seen any change as of date in either price or features as was originally envisaged at the time of launch. 

 

That apart, its Pulsar portfolio has over a dozen models of which some models have been priced up and some down in the last couple of months, as part of a regular exercise to drive competitiveness and profitability.

 

These revisions have been made in the normal course and as is typical, considering the market context including recognising the level of promotions/discounting (that has stepped up in recent months). 

 

The net impact of all these price changes on the quarter is nominal.

 

A UBS report on December 4, 2024, said that Bajaj Auto has cut the price of Freedom 125CC Motorcycle prices by Rs 5000- Rs 10,000 for entry/mid-level variants. 

 

The report also stated that a price cut means potential downside to street estimates and since launch, Bajaj has dispatched over 80,000 units to dealers, while Vahan retail stands at just 34,000 units. 

 

In the past one year, Bajaj Auto shares have gained 46.5 per cent against Sensex's rise of 17 per cent.