Bajaj Auto Ltd has posted a net profit of Rs 1,400 crore in the fourth quarter of 2010-11.
This includes a Rs 827-crore surplus from a sales tax deferral loan that was prepaid at a discounted value of Rs 368 crore. This appears as an exceptional item in the Profit & Loss Account and is chiefly responsible for 165 per cent growth year-on-year in the post-tax profit.
The company has also provided for Rs 102 crore as diminution in value of investment in PT Bajaj Auto Indonesia.
Without these two exceptional items, Bajaj Auto's profit after tax stands at Rs 676 crore, up 17 per cent over that in the same period last year (Rs 528 crore). The EBITDA margin was 20.5 per cent. The board has recommended a dividend of Rs 40 a share on a face value of Rs 10 on the expanded post-bonus share capital.
“We have managed to maintain EBITDA margins despite cost pressures like higher input costs,” Mr Rajiv Bajaj, Managing Director, said, adding that the strategy to compete with strong brands helped the company as it did not have to spend much on marketing. There is no sign that input costs will soften, he said. The company will, however, continue to post overall good growth on increased three-wheeler sales, higher exports and improved product mix, Mr Bajaj added.
On the outlook for 2011-12, he said the company is targeting 20 per cent growth. “We should grow 20 per cent overall and in each of our verticals. So, in motorcycles, we should be in the 4.6 million units space. Exports should be 1.2-1.4 million units, and maintain EBITDA margin at 20 per cent,” he said.
Elaborating on the product mix, Mr Bajaj said the strategy will be to create new ‘niche' categories. The company will make no further investments to push sales of the 100cc Platina, he said. The new 150 cc motorcycle for the rural market — Boxer — will be launched in July, he added.
Bajaj Auto's shares were down 1.65 per cent at Rs 1,286.85 on the BSE.