Bajaj Auto Q1 profit up slightly to `740 crore

The company had posted a net profit of Rs 737.68 crore in the same quarter last fiscal. Net sales during the period under review stood at Rs 5,133.37 crore as against Rs 4,808.73 crore in the year-ago quarter, the company said.

‘In terms of our operational profit we are still doing very well. We had an EBIDTA margin of 19.6 per cent. It is the tax expenses which has made our net profit growth look slow,’ Bajaj Auto President (Business Development & Assurance) S Ravikumar said.

During the quarter under review, the company had a total tax expense of Rs 335.11 crore as against Rs 300.15 crore in the year-ago period. Unit sales volume during the period grew marginally to 9,88,430 units as against 9,79,275 units in the same quarter last fiscal.

Ravikumar said while the company's Platina (15 per cent), Pulsar (18 per cent) and KTM (80 per cent) brands have witnessed good growth, the Discover bikes suffered during the quarter.

‘There is a problem with Discover and the brand value has eroded. During the quarter, there was a decline of 40 per cent in Discover bike sales,’ he said.

Bajaj Auto sells motorcycles positioned as value with 100 cc and 125 cc engine displacements under the Discover range for money and competes with the likes of Hero MotoCorp's popular models such as Super Splendor and Glamour, Honda Motorcycle and Scooter India's CB Shine and CBF Stunner.

‘We have understood the problem with Discover and are rectifying it. We will coming back strongly. We plan to launch a 150 cc motorcycle under the Discover range in the ongoing quarter,’ Ravikumar said. Another reason for the subdued overall sales in the first quarter this fiscal was due to the impact on three-wheelers exports to Egypt owing to the political situation there, he added.