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Bajaj Auto defies market sentiment; slips nearly 3 pc in early trade

Press Trust of India  |  Mumbai 

Shares of Auto defied the broader market sentiment Monday and fell nearly 3 per cent in morning trade on bourses.

Market experts said, though the fourth quarter earnings for the auto major was a good show in a tough environment, the company is expected to face margin pressure.

The shares of Auto opened at Rs 3,071, but lost ground and touched Rs 2,953.95, down 2.88 per cent over its previous close of Rs 3,041.80.

Shares of the company were later trading at Rs 2,992.10, down by Rs 49.70, or 1.63 per cent at 1021 hrs.

Auto was trading in the negative zone even as the broader market was trading with significant gains. The stock was the biggest loser in the Sensex pack.

"While we believe that margin downgrade cycle (but for any change to product mix) is behind, focus on domestic market share and higher share of in exports are likely to keep margin range bound," Edelweiss Research said in a note.

Edelweiss Research further noted that, a subdued demand environment, costs related to the entry in middle/segment (current market share of around 3 per cent) and technological changes due to BSVI will restrict margin to the current level.

Bajaj Auto Friday reported a 19.82 per cent increase in consolidated net profit at Rs 1,408.49 crore for the fourth quarter ended March 31, 2019.

Meanwhile, the BSE benchmark Sensex was trading with gains of 903.70 points or 2.38 per cent at 38,834.47 in early hours.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, May 20 2019. 10:40 IST