Bajaj Auto: Solid Q2FY26 Performance with Margin Expansion and Healthy Outlook
Yes Securities Maintains ADD Rating
Target: ₹10,056 | CMP: ₹8,901.55
Bajaj Auto delivered another steady quarter with Q2FY26 revenue up 13.7% YoY to ₹14,920 crore. The company maintained strong profitability, supported by improved ASPs, better currency realization, and a richer product mix.
The EBITDA margin expanded 130 bps QoQ to 20.5%, led by improved export performance and a healthy mix of premium motorcycles. PAT stood at ₹3,290 crore, up 11.6% YoY, supported by disciplined cost control and strong operating leverage.
Growth Outlook
Analysts highlight that domestic 2W recovery and sustained exports will remain key growth levers. The company continues to invest in EVs and high-end models like Chetak, which are expected to drive growth from FY26 onward.
While export recovery and GST clarity are awaited, improved profitability in the EV and BALC divisions bodes well for long-term valuations. With FY27–28 EPS growth expected at 23%, valuations near 22.7x FY27E remain reasonable.
Bajaj Auto’s strong balance sheet, expanding product range, and rising rural demand keep the medium-term outlook robust. The company remains a key beneficiary of cyclical recovery in the auto sector.
Investor Takeaway
Bajaj Auto remains a stable auto sector performer with improving profitability, new launches, and strong export volumes. Investors may continue holding with an upside target of ₹10,056.
Nifty and Bank Nifty Expert Gulshan Khera, CFP®, who is a SEBI Regd Investment Adviser.
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SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
