Company Profile
Bajaj Auto is the 2nd largest 2-wheeler company in India, and has a diversified product portfolio. In addition to catering to the local markets, exports are also a good chunk of the overall volumes.
Bajaj is India’s largest exporter of 2W and 3W vehicles, and it currently exports to Africa, Latin America and Asian markets. Currently it is exporting 25% of its overall sales.
In 2008, the earlier combined entity was split up between the brothers, and Bajaj Auto was formed. It is being headed by Rajiv Bajaj – who owns 49% of the company. Another 20% is owned by FIIs, and rest is held domestically.
Segmentation
Bajaj remains a market leader in the premium segment of motorcycles, with its Pulsar being the highest selling bike in the segment. Also, it has Discover catering to the largest segment (deluxe), and Platina in the entry level segment. Over the years, Bajaj has rationalized its offering, and now has a much leaner product portfolio.
The company was a dominant player in the scooter business, but it has now exited the business (as it had become unprofitable).
In the 3W segment, company is a market leader, and currently ~10% of the sales are derived from this segment.
Financials
Bajaj Auto is expected to exceed the industry growth rate in the coming years, and is expected to grow sales at 17-18% in coming years.
On an average, it is expected to sell over 4M vehicles in 2011 (60% in domestic 2W segment, 30% in exports, and 10% in 3W). EPS for 2010 is INR 60, and company is trading at a PE of 25.
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