Bajaj Auto Q1 net profit doubles; forms new EV arm

Bajaj Auto made a strong start in the new financial year, reporting a doubling of net profit in Q1 FY2022. 

• Q1 net profit stands at Rs 1,061 crore

• Bajaj Auto sold close to a million units in Q1 FY2022

• Bajaj will incorporate new EV arm

Bajaj Auto’s Q1 profits double

Bajaj Auto has reported a net profit of Rs 1,061 crore in Q1 FY2022 as against Rs 528 crore in Q1 FY2021. On the other hand, its revenue from operations also witnessed an increase, going up from Rs 3,079 crore a year ago to Rs 7,386 crore in Q1 FY2022.

EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) from operations was at Rs 1,153 crore while EBITDA margin for Q1 FY2022 was 15.6 percent as against 18.1 percent in Q4 FY2021. The EBITDA margin was largely impacted on three counts according to a regulatory filing by the company, “Lower revenue from operations resulted in loss on spread of fixed costs by 160 bps. Increase in cost of raw-material, net increase in prices, resulted in lower EBITDA margin by 220 bps. The above was partially off-set from higher US dollar realisation and improved mix.”

In terms of the number of units sold in Q1 FY2022, Bajaj managed close to one million units in the first quarter.

Bajaj Auto’s EV plans

In other news, Bajaj Auto has also approved the incorporation of a wholly owned EV subsidiary of the company. It will leverage the growth opportunities in the evolving mobility space and will help the Company venture into the manufacturing of Electric and Hybrid vehicles in the two-wheeler, three-wheeler and light four-wheeler categories.

At present, Bajaj sells the Chetak electric scooter in the Indian market, albeit in a limited number of markets. The company plans to expand to more cities in due course of time, the latest addition being Nagpur in Maharashtra. The Chetak is the company’s first electric vehicle and you can read about it here.

Besides making the Chetak, Bajaj Auto will also make EVs for Husqvarna, part of the KTM AG group. The Husqvarna Vektorr electric scooter,  that’s based on the Bajaj Chetak, will be manufactured at Bajaj’s factory, as part of the Bajaj-Pierer Mobility plan.