Bajaj Auto is trading higher by 2.5% at Rs 1,587, extending its previous two day gain in otherwise weak market on the Bombay Stock Exchange.
The stock of the country’s second largest motorcycle maker has rallied almost 10% as compared to a marginal 0.43% rise in the benchmark Sensex in past three trading sessions, on the back of an improvement in the Ebitda (earnings before interest tax depreciation and amortization) margins at 19.4% for the quarter ended June 2012 over the corresponding quarter last year of 19.1%.
The management expects the Ebdita margin to improve in the current quarter as well, on account of recent price hikes in the domestic motorcycle market, improved three-wheeler volumes and the launch of new products in the high margin segment.
The company, along with its distributors, has undertaken proactive measures like rationalising the end user cost of vehicles in Sri Lanka (price cut of 10-15% to be borne by company and the distributor) and expects normalised volumes of around 20,000 to Sri Lanka, starting Q3FY13.
