Strong export performance and growing electric vehicle segment offset domestic market recalibration, as company maintains healthy 20.2% EBITDA margin while advancing strategic priorities.
28 Jan 2025 | 2305 Views | By Sarthak Mahajan
Bajaj Auto reported a 6% year-over-year increase in revenue from operations to ₹12,807 crores in Q3 FY25, driven by strong exports recovery and expansion in their electric vehicle segment. This growth was underpinned by their highest-ever festive retail volumes in the domestic market, though the company recalibrated billed volumes to ...
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Bajaj Auto reported a 6% year-over-year increase in revenue from operations to ₹12,807 crores in Q3 FY25, driven by strong exports recovery and expansion in their electric vehicle segment. This growth was underpinned by their highest-ever festive retail volumes in the domestic market, though the company recalibrated billed volumes to normalize channel inventory that had accumulated between the previous quarter and this one.
On the profitability front, the company achieved significant milestones, with EBITDA and PAT surpassing ₹2,500 crores and ₹2,000 crores respectively. EBITDA margin remained steady at 20.2%, showing a 10 basis points improvement year-over-year. This margin maintenance was achieved through favorable USD/INR realization and dynamic P&L management, which helped offset significant strategic investments.
In the electric vehicles and green energy segment, the company made substantial progress. The Green Energy portfolio now contributes approximately 45% of revenues, a significant increase from 30% last year. The electric vehicles segment achieved notable growth, delivering around 100,000 units in the quarter, and has progressed from a loss-making position to achieving marginally positive EBITDA.
Traditional vehicles also showed mixed performance. The 125cc+ motorcycle segment achieved its highest quarterly retail volumes, though overall performance was impacted by the company's strategic decision to avoid deep price discounting. Commercial vehicles maintained strong growth with particularly impressive performance in electric three-wheelers. The Chetak brand demonstrated strong momentum with volumes growing 2.5x YoY and achieving 25% market share.
The export business showed remarkable improvement, achieving double-digit revenue growth for the fourth consecutive quarter. This recovery was broad-based across Africa, Asia, and LATAM markets. LATAM continued its strong growth trajectory, while the African market showed significant recovery, with volumes in Nigeria exceeding 100,000 units.
From a financial position perspective, the company maintains a robust balance sheet with surplus funds of ₹15,001 crores, having invested nearly ₹1,800 crores in their financing subsidiary. Their cash conversion remains strong, generating approximately ₹3,000 crores of free cash flow in the first nine months of FY25.
Volume performance showed varying trends across different segments and markets. In the domestic market, two-wheeler volumes decreased by 10% year-over-year to 5,87,855 units, while commercial vehicle volumes declined by 3% to 1,19,250 units, resulting in total domestic volumes of 7,07,105 units, representing a 9% decrease from the previous year.
The export business demonstrated strong recovery, with two-wheeler exports growing significantly by 21% to 4,66,766 units, and commercial vehicle exports showing robust growth of 33% to 50,601 units. This resulted in total export volumes of 5,17,367 units, marking a substantial 22% increase year-over-year.
When combining both domestic and export performance, total two-wheeler volumes showed modest growth of 1% to 10,54,621 units, while commercial vehicle volumes increased by 6% to 1,69,851 units. This resulted in overall volumes of 12,24,472 units, representing a 2% growth compared to the same quarter last year.