Higher input costs hit margins

QUARTERLY RESULT ANALYSIS: March 2005

(Rs Cr)

Q4FY05

Q4FY04

% change

Net sales

1647

1,284

28.31

Other income

126.55

64

96.93

Operating profit

248.29

226

9.92

OPM (%)

15.08

18

-

Net profit

239.68

196

22.30

NPM (%)

14.55

15.27

-

EPS (Rs)

23.80

19.40

-

12-month trailing P/E

15.02

 

Sales of three motorcycle brands at the higher end - Pulsar, CT100 Delux and Discover - helped the company clock revenues of Rs 1,647 crore (up 28.31 per cent).

 Average realisations per unit (including three-wheelers) were up 5 per cent to Rs 34,340 after the company increased two-wheeler prices in December 2004.

The share of three-wheeler segment in total sales fell about 300 basis points to 12.2 per cent. The overall profitability took a hit as this segment is more profitable than others.

Margins continued to remain under pressure. Operating margins fell 252 basis points to 15.08 per cent due to rising costs of inputs (mainly steel). Net margins, too, declined 71 basis points to 14.55 per cent.

 The outlook for Bajaj Auto is not very positive though the company