Margin headwinds for Bajaj Auto

But Maharashtra govt removing cap on auto-rickshaw permit offers some relief

The Maharashtra government has removed the cap on the issue of taxi and auto-rickshaw permits. The move, which could be rewarding for Bajaj Auto, helped the stock gain over 3 per cent at the start of Monday’s trade. Bajaj Auto, which is a dominant player in the three-wheeler space, depends on the segment for 11 per cent of its domestic sales volumes with Maharashtra being a key state. Given that sales of three-wheelers hasn’t fully recovered from demonetisation blues, the move will help the company garner better volumes as demand picks up. As volumes remained weak in the March quarter