Bajaj Auto falls 3% on market share loss, margin concerns; target prices
Bajaj Auto outloo: Nirmal Bang is concerned on the steep market share loss in the domestic market. Although exports are coming back strongly, it believes seizing market share loss is crucial.
- May 30, 2025,
- Updated May 30, 2025 10:36 AM IST
Shares of Bajaj Auto fell 3 per cent in Friday's trade as analysts trimmed their FY26 estimates on market share loss, especially in the 125cc segment, due to increased competitive intensity. They seemed also concerned over margins on account of rise in input costs, even as exports demand stayed solid. This led a few brokers cut target price on the stock.
Nirmal Bang is concerned on the steep market share loss in the domestic market. Although exports are coming back strongly, it believes seizing market share loss is crucial.
"Furthermore, we believe that the current valuation of 22 times FY27E limits the upside. We assign a target of Rs 9,615 valuing the core business at 24 times FY27 EPS.
KTM turnaround will be among the key monitorables, said MOFSL. Bajaj Auto has acquired a controlling stake in KTM under a lucrative deal, but its effectiveness depends on how quickly it is able to turn around its operations, the brokerage said as it sees the stock as fairly-valued. "We maintain a Neutral rating with a target of Rs 8,688, based on 24x FY27E core EPS," MOFSL said.
On Friday, the scirp was trading 2.56 per cent lower at Rs 8,645.60 apiece on BSE.
IIFL Securities said Bajaj Auto's Q4 results were slightly above estimates. It noted that the two-wheeler major's Ebitda growth moderated to 6 per cent in Q4, after a solid 20 per cent-plus growth in H1FY25. The broking firm said Bajaj Auto has lost market share in domestic two-wheeler industry, even as there are signs of improvement in demand over the recent marriage season, after being flattish over January-April 2025.
"We forecast only 4 per cent growth for Bajaj’s domestic 2Ws in FY26. We have trimmed FY26/FY27 EPS estimates by 3-4 per cent on lower volume estimates," IIFL Securities said as it retained 'Buy' rating with target price of Rs 9,900 on the stock.
A healthy product pipeline–affordable E-2W, entry-level 125cc motorcycle, E-rickshaw and new E-2W—is likely to aid volumes ahead, Nuvama said as it suggested a target price of Rs 10,700 on the stock.
"We reckon domestic 3Ws shall post a 4 per cent CAGR over FY25–27E led by replacement demand and improved business activity. Moreover, we expect a 10 per cent CAGR in 3W exports due to better demand in Latin America and ASEAN regions, and a low base. Furthermore, Bajaj Auto has announced plans to enter the E-rickshaw segment in July, targeting an addressable market of 40,000 units per month," Nuvama said.
Emkay Global suggested an unchanged target price of Rs 8,900 on the stock.
Shares of Bajaj Auto fell 3 per cent in Friday's trade as analysts trimmed their FY26 estimates on market share loss, especially in the 125cc segment, due to increased competitive intensity. They seemed also concerned over margins on account of rise in input costs, even as exports demand stayed solid. This led a few brokers cut target price on the stock.
Nirmal Bang is concerned on the steep market share loss in the domestic market. Although exports are coming back strongly, it believes seizing market share loss is crucial.
"Furthermore, we believe that the current valuation of 22 times FY27E limits the upside. We assign a target of Rs 9,615 valuing the core business at 24 times FY27 EPS.
KTM turnaround will be among the key monitorables, said MOFSL. Bajaj Auto has acquired a controlling stake in KTM under a lucrative deal, but its effectiveness depends on how quickly it is able to turn around its operations, the brokerage said as it sees the stock as fairly-valued. "We maintain a Neutral rating with a target of Rs 8,688, based on 24x FY27E core EPS," MOFSL said.
On Friday, the scirp was trading 2.56 per cent lower at Rs 8,645.60 apiece on BSE.
IIFL Securities said Bajaj Auto's Q4 results were slightly above estimates. It noted that the two-wheeler major's Ebitda growth moderated to 6 per cent in Q4, after a solid 20 per cent-plus growth in H1FY25. The broking firm said Bajaj Auto has lost market share in domestic two-wheeler industry, even as there are signs of improvement in demand over the recent marriage season, after being flattish over January-April 2025.
"We forecast only 4 per cent growth for Bajaj’s domestic 2Ws in FY26. We have trimmed FY26/FY27 EPS estimates by 3-4 per cent on lower volume estimates," IIFL Securities said as it retained 'Buy' rating with target price of Rs 9,900 on the stock.
A healthy product pipeline–affordable E-2W, entry-level 125cc motorcycle, E-rickshaw and new E-2W—is likely to aid volumes ahead, Nuvama said as it suggested a target price of Rs 10,700 on the stock.
"We reckon domestic 3Ws shall post a 4 per cent CAGR over FY25–27E led by replacement demand and improved business activity. Moreover, we expect a 10 per cent CAGR in 3W exports due to better demand in Latin America and ASEAN regions, and a low base. Furthermore, Bajaj Auto has announced plans to enter the E-rickshaw segment in July, targeting an addressable market of 40,000 units per month," Nuvama said.
Emkay Global suggested an unchanged target price of Rs 8,900 on the stock.