The levels investors need

A quarter that outran the forecast

Standalone revenue rose 34% to Rs 20,003 crore, beating Anand Rathi's Rs 19,500 crore estimate. Volume grew 20% to 15.5 lakh units, while realisation rose 12% year on year and 8% sequentially to Rs 1,29,147 a unit. Other operating income, swelled by production-linked incentive (PLI) and export benefits plus royalty, more than doubled to Rs 1,120 crore.

EBITDA margin widened 40 basis points to 20.9%, flat on the quarter, as scale, a weaker rupee and cost control absorbed a 180 basis point fall in gross margin. Adjusted profit rose 35% to Rs 3,354 crore, broadly in line with the brokerage's Rs 3,299 crore forecast and 6.4% above consensus.

Gear-shift ladder · Q2FY27 growth, year on year

Cash reserves fell to Rs 15,500 crore at the end of September from Rs 21,000 crore in June, mainly on bonus payouts. The finance arm posted revenue of Rs 1,177 crore and EBIT of Rs 325 crore.

Overseas roads: Bajaj outpaces every market it rides in

Exports are now the bigger engine. Overseas two-wheelers made up 44% of quarterly volume, ahead of domestic two-wheelers at 39%. In Africa, Bajaj grew 83% against an industry up 35%, with Nigeria retailing about 30,000 units a month at roughly 60% share, still only about 60% of its previous peak. Management expects exports to hold near 7.5 lakh units a quarter.

Road-lane bars · Q2FY27 growth, industry vs Bajaj

Fuel-tank volume mix · Q2FY27

Last segment: export three-wheelers. Domestic three-wheelers at 10%.

Festive drag race at home

The domestic two-wheeler market grew 18% between April and August after the goods and services tax cut. Management expects double-digit growth from September to December, but below that pace because of a high base. New launches are gaining traction fast: they made up about 7% of the 125cc-plus portfolio in August, 26% in September and 33% in the first 16 festive days. The company aims to enter January with a fully refreshed Pulsar range and two new brands spanning 125-250cc.

One caution: a monsoon deficit in Maharashtra, parts of the South and the Northeast could show up in rural demand in the March quarter.

The electric charge: profitable, and growing

The EV business, including Chetak scooters and electric three-wheelers, earned double-digit EBITDA margins and was margin-accretive to the domestic business. Cumulative EV revenue crossed Rs 10,000 crore, unlocking a 2% PLI booster. Electric scooter penetration stands near 25% and, management says, could reach 30-40%, possibly about 50%, within roughly three years. Supply limits meant EV plans delivered only about 75% of target; Chetak capacity rises to 80,000 units a month in the March quarter.

Service book: the cost pressure ahead

Bajaj shows the least margin volatility among two-wheeler makers, the brokerage argues, because forex gains and pricing offset most input inflation. Commodity costs rose about 3-3.5% in the September quarter, half recovered through price increases and the rest through the weaker rupee, operating leverage and leaner spending. Another rise of a couple of percentage points is expected in the December quarter, and about 30% of it was covered by price increases in early October.

Chain drive: how the Rs 14,300 target is built

Anand Rathi expects volume, revenue, EBITDA and core profit to compound at 11%, 17%, 17% and 17% over FY26-29. It values the core business at 25 times September 2028 core earnings, above the stock's 20 times long-run forward average, and adds the KTM stake, the finance arm and surplus cash.

Per-share values. KTM at a 20% holding discount to market value; finance arm at 2x FY26 book of Rs 3,400 crore; cash as of September 2027. See the Editor's Note on how these parts add up.

Ride log · Anand Rathi's rating and target history