New Delhi: Pune-based Bajaj Auto plans to invest about INR 800 crore capex (capital expenditures) in FY 2024-25. The automaker committed a capex of INR 800 crore in FY 2023-24 as well.
“We will be spending between INR 700- 800 crore, primarily to complete the capex on our three wheeler plant and possibly some expansion that we need to do on Chetak as well,” Dinesh Thapar, Chief Financial Officer (CFO), Bajaj Auto, told ETAuto during the company’s post-Q3 earnings media briefing on Thursday.
“Some of the capex will go into dyes and moulds, given that the innovation and density across the business has stepped up,” he added.
Last quarter, ETAuto reported how the two and three wheeler maker was working to ‘unlock capacities’ and expand its network.
On Thursday, Thapar also confirmed that Bajaj Auto is bringing a new mass-market electric scooter under the Chetak brand in May. Currently it sells two variants of the model- Chetak Premium and Chetak Urbane.
The company reported 18% growth in its consolidated net profit to INR 2,011 crore during January-March 2024 quarter, as against INR 1,705 crore in the corresponding quarter of last year. Total revenue from operations rose to INR 11,555 crore in the quarter ended March 2024, up from INR 8,929 crore in the fourth quarter of last year.
According to the CFO, buoyancy of the domestic market’s performance has continued to lead the company’s results in Q4 FY24.
The Board of Directors have recommended a final dividend of 80 per share, totalling to INR 2,233 crores.
| Bajaj Auto Domestic Sales (unit volumes) | Q4 FY24 | F4 FY23 | % change |
| Two wheelers | 5,46,881 | 4,14,990 | 32 |
| Three wheelrs | 1,10,449 | 1,00,033 | 10 |
| Total | 6,57,330 | 5,15,023 | 28 |
CNG motorcycle
Last month, Managing Director Rajiv Bajaj confirmed that the automaker is developing a portfolio of clean fuel CNG motorcycles, and the first such bike will hit the market in June. It will target mileage-conscious consumers and is expected to be priced higher than its petrol counterparts.
When asked about the investment that has gone into the CNG motorcycle business, Thapar said, “It is not such a large number, it sits within our capex. And the bulk of our capex that we spend is largely on capabilities and capacities for our electric business.”
Considering the network of CNG infrastructure in the country which is expected to grow faster but is mostly concentrated in a few states as of now, the automaker is “absolutely mindful” of planning the launch of its upcoming motorcycle in a “phased manner”. In the initial phase, the motorcycle will be launched in cities with a dense CNG network.
The company said it has an expertise and experience in CNG fuel vehicles as almost 3/4th of its passenger three wheelers sales come from CNG. For the new motorcycle launch, it has mapped out certain districts across the country in terms of the availability of CNG network.
As of 2023-end, the Northern and Western region of India has a comparatively better network of CNG stations. Gujarat takes a lead, followed by Uttar Pradesh, Maharashtra and the NCR (National Capital Region).
Triumph Business
Last quarter, Bajaj talked about increasing the monthly production of Triumph motorcycles. Currently, Bajaj Auto makes about 6,500 units of its Triumph motorcycles a month. It aims to achieve its target of 10,000 units by September this year.
In 2017, Bajaj and British motorcycle brand Triumph formed a global partnership. In July last year, the two companies launched co-developed Triumph Speed 400 and Scrambler 400 X motorcycles in India. The models are produced at Bajaj Auto’s new manufacturing facility in Chakan, which initially had a capacity to produce 5,000 units of these bikes per month. It was later scaled up to 8000 units.
In the October-December 2023 quarter, Bajaj started exports of Triumph motorcycles by selling 7000 units in markets including the UK, US, Japan, Australia and Poland.
Exports
During the January- March 2024 period, Bajaj’s export revenues grew double digit YoY as it benefited from a richer mix and better realisations. However, volume was flattish compared to last quarter but up about 20% vs. previous year, the YoY growth being accentuated by a soft base comparator in the base period.
| Bajaj Auto Exports (unit volumes) | Q4 FY24 | Q4 FY23 | % change |
| Two wheelers | 3,69,936 | 3,10,415 | 19 |
| Three Wheelers | 41,310 | 34,290 | 20 |
| Total | 4,11,246 | 3,44,705 | 19 |
A big part of the revenues from the exports mix is also being driven by the shipment of premium motorcycles to Latin America, which is a large sports motorcycle market, said the CFO.
