Booming exports and higher motorcycle sales in the domestic market have helped Bajaj Auto Ltd post a net profit of Rs 726 crore for the second quarter of FY 12 against Rs 682 crore in the corresponding period the previous fiscal, reflecting an increase of 6 per cent year-on-year.
Total turnover of Rs 5,342 crore (Rs 4,426 crore) during the quarter under review showed a rise of 21 per cent. Earnings before interest, tax and depreciation (EBITDA) were Rs 1057 crore, while operating EBITDA margin stood at 20.1 per cent.
The company's bottom line was impacted because it chose to protect its future export realisations by entering into range forward contracts. “As per the principles laid down under the accounting standard AS30, some of the range forward contracts are deemed ineffective. Accordingly, an MTM loss of Rs 95 crore on valuation of the contracts is charged to the P&L account. This is a purely notional loss and would get reversed on maturity of the underlying contracts,” BAL said in a statement.
Sales grow
In the three-month period ended September 30, 2011, BAL sold a total of 1,027,357 motorcycles, including a third (3,42,686 units) in overseas markets. Domestic bike sales rose by 8 per cent, while their exports were up by 37 per cent YoY.
The Pulsar brand averaged 86,000 units per month, while the Discover averaged 133,000 numbers per month while cumulative sales for the ‘Discover' brand crossed 5 million. The overall market share stood at 34 per cent in and the share in domestic market stood at 27 per cent.
Commercial vehicles
On the commercial vehicle front too, BAL was supported by the foreign market as CV sales rose 44 per cent to stand at 81,448 units while they were lower by 9 per cent in the Indian market.
In value terms, exports grew by 50 per cent to stand at Rs 1,733 crore and overseas markets now contribute over 36 per cent of all vehicles sold.
During the quarter, the company received VAT refund of Rs 860 crore. After paying Rs 1,345 crore towards dividend and tax thereon, it had surplus cash and cash equivalents of Rs 4,516 crore, as on Sept 30, 2011.