Bajaj Auto Ltd Q1 FY2027 Concall Summary

Key Takeaways

• Record quarter despite heavy disruptions: Revenue, EBITDA and PAT hit all-time highs even as a ransomware attack, supply-chain snarls and labour shortages impaired availability by 10–15%, costing the company a shot at 0.15 crore units.
• Commodity inflation compressed into one quarter: Input-cost inflation hit ~4.5% of revenue, with the metals basket up 10–40%; the inflation absorbed in Q1 alone exceeded the total of the prior two financial years combined.
• Pricing and currency offset half the hit: Calibrated price increases and a strong realised USD-INR of 94.4 covered roughly half the commodity surge, while mix and operating leverage drove sequential EBITDA margin expansion.
• Domestic motorcycle reset is imminent: A complete 125cc+ portfolio makeover lands in the next six weeks — 10 facelifts and two all-new Pulsars — aiming to replicate the 150cc+ outperformance in the 125cc band.
• What to watch next quarter: Whether the six-week launch wave lifts 125cc+ market share, how much of the Q2 commodity overhang actually materialises, and whether exports sustain above the 250,000/month mark.

Quarter in Review: Record Results, Extraordinary Headwinds

• All parameters at record highs: The company delivered its highest-ever quarterly volumes, revenue, EBITDA and PAT, beating most analyst estimates.
• Ransomware attack forced a shutdown: Operations were suspended for several days for investigation and remediation; the attack was defended comprehensively and successfully, but the downtime contributed to lost output.
• Supply-side disruptions compounded the hit: Industrial LPG curtailment forced energy reconfiguration, geopolitical developments in West Asia triggered force majeure by global suppliers and disrupted maritime logistics, and localised labour shortages from election-driven migration and higher living costs stifled production in April and May. Together these factors impaired availability by 10–15%, with exports, high-end bikes and EVs hit hardest.
• Without the disruptions, 0.15 crore units was in reach: Management stated the company was on track to cross 0.15 crore units for the quarter before the shocks landed.

Sharma: "It was a tough quarter with RM inflation, supply chain and logistics disruptions as well as a ransomware attack, which you may have read about, but it was defended comprehensively and successfully."

Commodity Inflation: A Once-in-a-Decade Squeeze

• Inflation intensity rarely witnessed: Commodity inflation accelerated sharply through May across virtually the entire basket — steel up 10%+, aluminium, platinum and rhodium up ~40%, with ABS, copper, nickel and natural rubber also rising substantially. Inflation also built across proprietary components, electronics, energy, logistics and labour, pushing overall conversion costs higher.
• Single-quarter inflation exceeded two prior years combined: The commodity inflation absorbed in Q1 was greater than the totality of inflation experienced over FY25 and FY26 put together, reaching approximately 4.5% of revenue.
• Pricing recovered roughly half: Calibrated price actions taken through April and June offset nearly half the commodity impact; the balance was absorbed through dollar realisation gains and discretionary cost rationalisation.
• Currency provided structural cushion: Realised USD-INR of 94.4 compared with 90.6 in Q4 and 85.6 a year ago, a meaningful tailwind given exports now represent 40–45% of the business.
• Q2 will feel the full-period impact: Cost pressures are no longer confined to base metals; proprietary components, electronics, labour, logistics and energy are all moving up simultaneously, and Q2 will reflect inflation over a full quarter. Management called the environment too volatile to put a precise number on the outlook.

Thapar: "To put this in perspective, the commodity inflation we absorbed in this single quarter was greater than the totality of the inflation we've experienced over the previous 2 financial years put together."

Exports: Broad-Based Surge, Africa and LatAm Lead

• Exports grew across all regions except MENA: Growth was broad-based, with superior price realisations compared to Q4; the Middle East and North Africa was the sole exception for obvious geopolitical reasons.
• Africa grew ~50%, Bajaj grew twice that: The new Boxer 125 Heavy Duty upgrade drove outperformance; Nigeria led on pre-election institutional sales, with Bajaj doubling retails year-on-year and capturing ~60% retail market share.
• Latin America outpaced the industry: Mexico, now among the world's top five motorcycle markets, was the standout, driven by high-end NS-series and N250 models, a well-organised supply chain with best-in-class 3% tariffs, and a wide distribution network.
• Asia was muted, share defended: Underperformance in Bangladesh and Nepal weighed on the region; the objective was to protect market share and keep the dealer network strengthened.
• KTM and Triumph exports revived: KTM motorcycle exports from India recovered after several quarters of disruption; Triumph brand exports grew 40% year-on-year.
• Target: sustain above 250,000 units/month: Management aims to move exports beyond the 250,000 monthly level from Q2 onwards, backed by sports-segment leadership in LatAm and more aggressive share gains in African commercial bikes.

Domestic Motorcycles: The 125cc+ Reset Is Now

• Demand is splitting by income: The upper half of society is economically much stronger, while those down the pyramid have weakened; this is reflected in motorcycle growth dropping from 23–24% to 8–9%, while 150cc/250cc segments grow at 20%+. The 100cc and 125cc segments are at low single-digit growth.
• Pulsar fatigue was recognised and addressed: By FY26, end-of-cycle fatigue had set into the Pulsar portfolio; management prioritised the 150cc–250cc heartland, reinvigorating it with N-series and NS-series upgrades. These new parts of the range are outpacing the industry by 1.5x and gaining market share, with state-wise performance showing all green.
• Old Pulsar variants still drag: Legacy parts of the 150cc+ range continue to weigh on performance, but the new N/NS models have overcome that drag to deliver a net market share increase.
• 100cc share loss is deliberate: Bajaj is losing share in the 100cc segment, which drags down overall motorcycle market share; management participates on its own profitability terms and favours margin over volume when the two conflict.
• The six-week launch wave is the catalyst: Between now and early September, the company will launch 10 facelifts across the 160cc–400cc range, two all-new Pulsars (one 150cc, one 125cc) with class-leading features and electronics, plus additional upgrades. Early acceptance reports are expected by the October earnings call.
• Two new brands planned this fiscal: Two entirely new nameplates, distinct from Pulsar, are expected within FY27, though timing depends on the environment.
• Strategic intent: upgrade 100cc customers to 125cc: The new 125cc products are designed to cover the full customer spectrum and pull buyers up from the 100cc segment.

Sharma: "The upper half of the society are economically much, much stronger and the people down the pyramid have weakened. And this is getting reflected in the way the segments are growing."

Electric Vehicles: Chetak Turns the Corner

• Chetak demand still outstrips supply: Demand continued to run ahead of ability to supply; capacity expansion is underway with both immediate and medium-term focus.
• Chetak is now EBITDA positive: The electric scooter has moved from EBITDA neutral to EBITDA positive; combined with the growing scale of the e-three-wheeler business, the overall electric portfolio is delivering double-digit EBITDA margins.
• Store viability is no longer a constraint: Two years ago, store economics limited network expansion; now the industry is growing fast enough that viability issues are disappearing, enabling management to step on network expansion toward a target of ~1,000 stores in a couple of years, up from ~530–550 today.
• Chetak 2501 targets younger buyers: The newly launched variant is ~25 kg lighter, easier to manoeuvre, with good range and vibrant colours, marking a substantive departure from the existing Chetak range.
• International expansion beginning: Chetak has launched in the Indian subcontinent and is on its way to the Philippines and a couple of other markets; as capacity improves, global expansion will accelerate.
• EV adoption driven by operating economics: The West Asia crisis and rising petrol prices have spurred a surge in EV adoption; the e-two-wheeler industry grew 67% while motorcycles grew 8%. Management expects penetration to reach 30–40%, with some states already at 60%, and believes 50% of scooters could be electric in a couple of years.
• Three-wheeler EV leadership maintained: The ICE three-wheeler franchise holds ~70% market share; EV leadership is intact, and the newly introduced Riki e-rickshaw is progressing steadily with presence in nearly 150 cities.

Sharma: "I remember, just 2 years back, we used to be sitting and breaking our heads as to which all cities we can enter or which we can't enter because of store viability. Now that constraint is almost disappearing, which will allow us to now really step on it and expand the network."

KTM and Triumph: Turnaround and Collaboration Resume

• KTM manufacturing ramp-up progressing: Production has progressively ramped through the year and is approaching underlying retail demand; billing performance has improved, and the planned normalisation of dealer and plant inventories is largely complete, with inventory levels stabilising at desired levels.
• Cost control benefits becoming evident: Tighter control on fixed costs and overheads is starting to show in KTM's financial performance.
• Co-design collaboration with KTM R&D has resumed: The partnership, interrupted for approximately two years due to KTM's issues, has been picked up again with more strength and conviction. A substantial amount of KTM manufacturing is expected in India, though management stopped short of calling it a global manufacturing hub.
• Triumph momentum sustained: The recently launched Tracker 400 has maintained momentum; a couple of new Triumph products are on the anvil. Together with KTM Adventure and Triumph Scrambler, Bajaj now leads the Adventure category in India.
• KTM-Triumph joint stores expanding: Rollout is progressing steadily, with almost 90 outlets now operational.

Sharma: "And as far as we know, India as a manufacturing base is highly competitive... India as a manufacturing base, at least, I can say in motorcycles, is absolutely outstanding and out there in the forefront."

Guidance & Commitments

Key Metrics