Bajaj Auto Shares Decline 2.5% After Q4 Results; Should You Buy This Bajaj Stock? Check Top Brokerages' Review

Bajaj Auto Stock After Q4 Report: On the final trading day of the week, Friday, May 30, 2025, shares of Bajaj Auto faced downward pressure, declining as much as 2.51% to touch an intraday low of Rs 8,650.10 per share.

Bajaj Auto Share Price Today After Q4 Results 2025

As of 11:43 AM on May 30, Bajaj Auto Limited's shares were trading on the NSE at Rs 8,651.50. The stock experienced a decline of 2.51%, falling by Rs 223.00 during the trading session. This reflects continued pressure on the share price amid market activity on that day.

Should You Buy This Bajaj Stock? Get Top Brokerages' Ratings for Bajaj Auto Post Earnings

According to analysts at Motilal Oswal, Bajaj Auto reported earnings of Rs 2,050 crore for the fourth quarter of FY25, broadly in line with market expectations. Operating margins remained stable year-on-year at 20.2%, supported by a favourable currency environment and an improved product mix. However, these gains were offset by the suspension of exports to KTM and a rise in promotional expenses.

While the recovery in export markets and the strong ramp-up of the Chetak electric scooter and the three-wheeler (3W) segments are seen as positive developments, analysts highlighted ongoing concerns about Bajaj Auto's shrinking market share in the domestic motorcycle segment-especially in the important 125cc and above category.

Additionally, the launch of Bajaj's CNG motorcycle, the Freedom, has progressed more slowly than expected. The company's recent acquisition of a controlling stake in KTM was executed on favourable terms, but analysts noted that the success of this strategic move will depend on how effectively Bajaj can turn around KTM's performance-a key area to monitor going forward.

Valuation-wise, the stock is trading at approximately 26.9x and 24x FY26E and FY27E earnings, respectively. Given this, Motilal Oswal has maintained a 'Neutral' rating on Bajaj Auto, assigning a target price of Rs 8,688, based on 24x its FY27E core earnings per share.

Kotak Equities Institution Revised Earnings Estimates For Bajaj Auto: Understand Detailed Analysis

Kotak Equities Institution (KEI) has revised their earnings estimates for Bajaj Auto for the financial years 2026 and 2027. It points out that the company is facing challenges in the domestic two-wheeler market. Bajaj is struggling to keep up in the 125 cc motorcycle segment due to increased competition from multiple new launches. Additionally, there is a price war in the 110 cc segment, but Bajaj is deliberately choosing not to aggressively compete in that space.

On the brighter side, Bajaj is steadily increasing its electric vehicle (EV) production, and export volumes are recovering. These factors are expected to support moderate growth for the company over the medium term. However, Kotak expects the company's domestic two-wheeler sales to grow at a slower pace of about 5-6% annually between 2025 and 2027, compared to the double-digit growth experienced over the past two years.

"Overall, we expect domestic 2W industry volumes for the company to increase at a CAGR of 5-6% over FY2025-27E versus the double-digit CAGR over the past two years. We believe margins have peaked out and will sustain at these levels," stated Kotak Equities Institution

Regarding profitability, Kotak believes Bajaj's margins have likely peaked and will maintain their current levels going forward. They also express caution about Bajaj's recent acquisition of a controlling stake in Pierer Mobility, a premium brand currently facing financial difficulties. The turnaround of this brand could be challenging given the shifting dynamics of the global market.

Currently, Bajaj Auto's stock is trading at around 25 times its estimated earnings for 2026. This valuation implies a strong double-digit earnings growth over the next 15 years, which Kotak considers overly optimistic. They highlight that two-wheeler penetration in India is already high, with approximately 58-60% of households owning a two-wheeler, which limits future growth potential. For these reasons, Kotak Equities has maintained a SELL recommendation on Bajaj Auto shares and revised the target price slightly higher to Rs 7,250 from Rs 7,000.

"The stock is trading at 25X FY2026E EPS, implying double-digit EPS growth over 15 years, which we believe is challenging, given the higher penetration levels (~58-60%) of 2Ws per household in India. Reiterate SELL with a revised FV of Rs7,250 (from Rs7,000)," the brokerage mentioned.

Bajaj Auto Q4 Results Highlights

Bajaj Auto Q4 FY25 Net Profit: Bajaj Auto unveiled its financial results for the fourth quarter of fiscal year 2025 (Q4FY25) post-market hours on May 29, 2025. The company reported a year-on-year increase of 5.85% in standalone net profit, which rose to Rs 2,049 crore in Q4FY25 from Rs 1,936 crore in the corresponding quarter of the previous fiscal.

Bajaj Auto Q4 Revenue: In the fourth quarter of the Q4FY25, Bajaj Auto reported a notable increase in its total revenue from operations. The company posted revenues of Rs 12,148 crore, reflecting a YoY growth of 5.8% compared to Rs 11,484.7 crore recorded in the same quarter of the previous fiscal (Q4FY24).

Bajaj Auto EBITDA: At the operational level, Bajaj Auto delivered a solid performance, the company's earnings before interest, tax, depreciation, and amortisation (EBITDA) rose by 6.3% year-on-year, reaching Rs 2,450.6 crore, compared to Rs 2,306.3 crore in the corresponding quarter of the previous fiscal year.

In addition to the EBITDA growth, the company saw a marginal improvement in profitability. The EBITDA margin edged up to 20.17% in Q4FY25, slightly higher than the 20.08% reported in Q4FY24.

Bajaj Auto Final Dividend: Payout and Recording Date Details

The Board of Directors of Bajaj Auto has proposed a substantial dividend for the financial year 2025. A dividend of Rs 210 per equity share has been recommended, representing a 2,100% payout on the face value of Rs 10 per share.

This proposed dividend is subject to shareholder approval at the upcoming Annual General Meeting (AGM). If approved, the dividend will be credited or dispatched to eligible shareholders on or around August 8, 2025.

Bajaj Auto has announced that it has fixed June 20, 2025, as the record date for the purpose of determining the eligibility of shareholders to receive the proposed final dividend for the financial year 2025.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.