Demand ahead of supply
Electric vehicles spearheaded Bajaj's growth in the quarter. The company's electric portfolio reached a record of about 2 lakh units, against 82,000 a year ago, and now makes up one-third of domestic revenue, according to its press release. The company said this came despite a tight supply situation.
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Electric three-wheeler volumes and revenue more than doubled from a year ago, and Bajaj is adding capacity to serve demand it has not been able to meet, the press release said.
Chetak, its electric scooter, had its biggest ever quarter. Volumes more than doubled on a relatively soft base and revenue crossed ₹2,000 crore. The company said the quarter was marked by severe supply problems, as demand ran ahead of an exceptionally lean pipeline, and that production is being ramped up for both domestic and export orders.
The shortfall is not new. When it reported April-June results in July, Bajaj said demand continued to outpace capacity and that tight capacity and constrained supplies had limited its electric business. It said investments to raise production were under way and that a capacity expansion for electric three-wheelers had been started, according to the company's press release at the time. Electric vehicles made up about 30% of its domestic revenue then, compared with one-third now.
The CFO also spoke on price increases. Bajaj needs to watch how much more pricing the market can absorb, he said, according to Reuters.
Pricing has helped the company so far. Bajaj said record volumes were supported by pricing, a richer sales mix and a favourable currency. Its operating margin held at 20.9%, as a currency gain, operating leverage and cost control made up for the fact that only part of the rise in input costs has been recovered through price increases, the press release said.
A record quarter overall
On a standalone basis, Bajaj's revenue crossed ₹20,000 crore for the first time, at ₹20,003 crore, up 34% from a year ago. Net profit rose 35% to ₹3,354 crore from ₹2,480 crore.
The company sold 15.49 lakh vehicles, up 20%. Exports rose 41% to 7.79 lakh units, while domestic sales rose 4% to 7.70 lakh units. Domestic revenue grew 30%, the company said, much faster than volumes.
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