Bajaj Auto jumps 4% to 52-week high post Q1 show; analysts split on outlook

Shares of Bajaj Auto were in demand on Wednesday, July 22, and climbed 4.14 per cent to a fresh 52-week high of ₹10,839.45 on the BSE during early trade after the company announced its financial results for the first quarter of the financial year 2026-27 (Q1FY27).

 

The stock, however, pared some gains as the session progressed. At 9:45 AM, Bajaj Auto shares were trading at ₹10,774.55, up 3.52 per cent from the previous close. In comparison, the benchmark BSE Sensex was down 555 points, or 0.72 per cent, at 76,914.

Bajaj Auto Q1 results

Bajaj Auto reported a 46 per cent year-on-year (Y-o-Y) rise in consolidated net profit to ₹3,225.63 crore in Q1FY27, while revenue increased 65 per cent Y-o-Y to ₹21,688.8 crore. The growth was supported by record vehicle volumes, higher realisations, and broad-based growth across domestic and export markets, internal-combustion engine (ICE) and electric vehicles (EVs), and two- and three-wheelers.

 

 

Sequentially, revenue increased 22 per cent, while net profit declined 12 per cent. However, the company said the consolidated figures were not comparable with the year-ago and preceding quarters following the acquisition of a controlling interest in Bajaj Auto International Holdings AG (BAIHAG) and consolidation of its financial results from the current quarter.

 

The company’s profitability was supported by a favourable rupee, improved product mix, operating leverage, pricing actions, and cost savings, which helped offset sharply higher input costs.

 

Bajaj Auto reported a 29 per cent YoY increase in total vehicle sales to a record 1.44 million units during Q1FY27, driven by strong export growth, higher domestic sales, and expansion of its electric two- and three-wheeler businesses.  CHECK Stock Market LIVE Updates

Brokerages remain divided

Brokerages remained divided on Bajaj Auto after its Q1FY27 results, with concerns over domestic motorcycle market share and margin pressures weighed against strong export growth, improving EV profitability, and operational efficiencies.

JM Financial stays cautious

JM Financial retained its ‘Reduce’ rating and revised its target price to ₹9,850 from ₹9,600 earlier.

 

The brokerage said Q1FY27 Ebitda margin came in at 20.9 per cent, up 110 basis points YoY and 10 basis points sequentially, and was 80 basis points above its estimate, led by operating leverage and currency tailwinds, partly offset by higher raw material costs.

 

JM Financial said domestic motorcycle demand has underperformed two-wheeler industry growth, primarily due to slower growth in the below-125cc segment.

 

“Bajaj Auto’s market share declined to 10.5 per cent in Q1FY27 from 10.8 per cent in Q4FY26 and remains well below 12.1 per cent in January 2024. Traction beyond Pulsar has been muted; hence, we do not expect meaningful gains in market share despite further launches,” JM Financial said.

 

The brokerage expects around 14 per cent volume growth in FY27, primarily led by exports. While cost optimisation and currency tailwinds could provide some cushion, raw material inflation and costs associated with new launches are expected to weigh on margins.

Elara Capital sees structural positives

Elara Capital maintained its ‘Accumulate’ rating with an unchanged target price of ₹12,020.

 

The brokerage said Bajaj Auto’s ability to protect margins despite sharp commodity inflation reinforces the strength of its export franchise, favourable currency exposure, and disciplined cost structure.

 

“The improving profitability of Chetak and the electric three-wheeler portfolio are structural positives, with EVs now becoming a meaningful earnings contributor rather than just a volume-growth driver,” Elara Capital said.

 

However, the brokerage flagged continued market share pressure in domestic motorcycles, particularly in the entry and executive segments.

 

Elara Capital said the comprehensive Pulsar refresh and introduction of new 125cc brands ahead of the festive season could help arrest the decline.

 

“Any sustained improvement in Vahan market share would be an important stock trigger,” it added.

Choice retains ‘Add’

Choice Institutional Equities retained its ‘Add’ rating on Bajaj Auto and raised its FY27 and FY28 earnings estimates by 6.1 per cent and 3.9 per cent, respectively.

 

The brokerage attributed the upward revision to better-than-expected Q1FY27 performance, robust export growth, and sustained EV momentum.

 

“We value the stock at a 25x (maintained) P/E multiple on the FY28 EPS estimate and arrive at a revised target price of ₹11,700,” said Choice.

 

The brokerage expects Bajaj Auto’s export franchise, improving EV contribution, and operational efficiencies to continue supporting earnings growth.  =======================================

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