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Higher promotion costs may keep Bajaj Auto margins under pressure

The company has highlighted some tailwinds to support the margins

Higher promotion costs may keep Bajaj Auto margins under pressure
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Ram Prasad Sahu
Bajaj Auto’s declining margins story continues, with volume gains failing to overcome the drag on profitability on account of a weaker product mix, aggressive pricing and lower export realisations.

Volumes in the December quarter were up 25.8 per cent over the year-ago quarter, led by entry level motorcycles as well as the Pulsars. The company’s overall domestic motorcycle market share was up 400 bps over the year-ago quarter, and has crossed the 20 per cent mark.

Market share gains in the entry-level segment (volumes up 61 per cent) — in which the firm adopted an aggressive stance — have been sharper, up

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First Published: Jan 31 2019 | 12:12 AM IST

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