Bajaj Auto Limited (BAJAJ.AUTO) AI Stock Analysis

• Market Cap: ₹2.48T
• Dividend Yield: 2.31%
• Average Volume (3M): 11.23K
• Price to Earnings (P/E): 23.7
• Beta (1Y): 1.11
• Revenue Growth: 11.83%
• EPS Growth: 13.79%
• Country: IN
• Employees: 6,192
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Auto - Manufacturers
• EPS (TTM): 91.30
• Shares Outstanding: 279,497,830
• 10 Day Avg. Volume: 12,817
• 30 Day Avg. Volume: 11,226
• PEG Ratio: -8.19
• Price to Book (P/B): 6.34
• Price to Sales (P/S): 4.30
• P/FCF Ratio: -112.74
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹11,420.00
• Price Target Upside: 24.60% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): 342.79
• Revenue Forecast (FY): ₹574.28B

• Rating: 64 Neutral
• Price Target: ₹10,500.00 ▲(14.56% Upside)
• Action: Reiterated Date: 10/04/25
• Date: Action: Reiterated 10/04/25

Bajaj Auto Limited demonstrates strong financial performance with robust revenue growth and operational efficiency. However, challenges in cash flow and profitability margins, combined with weak technical indicators, weigh on the overall score. The stock's valuation is relatively high, but the dividend yield offers some support.

Positive Factors

Revenue Growth

Sustained revenue growth (15.66% overall and 10.46% YoY) indicates durable demand across domestic and export markets. Over 2–6 months this supports scale benefits, stronger distributor relationships, and recurring parts/after-sales revenue that underpin long-term cash generation potential.

Operational Efficiency

High EBIT (19.71%) and solid gross margins (26.45%) reflect efficient production and pricing power. These margins are structural advantages from manufacturing scale, product mix and brand positioning, enabling reinvestment, competitive pricing flexibility, and resilience to moderate commodity cost swings.

Strong Equity Base

A high equity ratio (64.92%) and ROE of 20.82% signal a healthy capital structure and effective use of shareholder capital. This provides a durable buffer against industry cyclicality, supports capital allocation for new models/markets, and reduces refinancing risk in normal conditions.

Negative Factors

Weak Cash Generation

Negative operating cash flow and a steep free cash flow decline (-133.89%) point to deteriorating cash conversion. Structurally weak OCF undermines ability to fund capex, dividends and debt service from operations, increasing reliance on financing if not reversed.

Rising Leverage

New debt in 2025 lifted leverage to a D/E of 0.26. While still moderate, increased borrowing combined with weaker cash flow raises interest and refinancing risk over months ahead and can constrain strategic flexibility if earnings or cash conversion falter.

Declining Net Margin

A drop in net margin to 14.36% despite solid EBIT signals pressure from non-operating items, interest or taxes, or mix shifts. Persistent margin erosion would reduce retained earnings and free cash, limiting reinvestment and making the business more vulnerable to cost shocks.

Bajaj Auto Limited Business Overview & Revenue Model

Company Description

Bajaj Auto Limited develops, manufactures, and distributes automobiles in India. It operates through Automotive and Investments segments. The company offers motorcycles, commercial vehicles, electric two-wheelers, etc., as well as related parts. It also exports its products. The company was founded in 1945 and is based in Pune, India.

How the Company Makes Money

Bajaj Auto generates revenue primarily through the sale of its vehicles, including motorcycles, scooters, and three-wheelers. The company earns money by selling these products in domestic markets as well as exporting them to various countries, which significantly contributes to its earnings. Key revenue streams include the sale of two-wheelers, which account for a substantial portion of the company's revenue, followed by three-wheeler sales. Additionally, Bajaj Auto has established partnerships with various international firms and distributors, enhancing its market reach and facilitating exports. The company also benefits from after-sales services and spare parts sales, further diversifying its revenue. Factors such as brand reputation, product innovation, and expanding market presence in emerging economies play a crucial role in driving its earnings.

Bajaj Auto Limited Financial Statement Overview

Summary

Bajaj Auto Limited shows strong revenue growth and operational efficiency with a solid equity base. However, challenges in profitability margins and cash flow generation need attention. The balance sheet is robust, but increasing leverage requires monitoring.

Income Statement

Bajaj Auto Limited has demonstrated strong revenue growth with a 10.46% increase from 2024 to 2025. The gross profit margin is solid at 26.45%, although it has slightly decreased from previous years. The net profit margin has also decreased to 14.36%, indicating some pressure on profitability. Despite this, the EBIT margin remains high at 19.71%, showcasing operational efficiency. Overall, the income statement reflects robust growth and efficiency but highlights a need for improvement in net profitability.

Balance Sheet

The balance sheet of Bajaj Auto Limited shows a strong equity base with an equity ratio of 64.92%, indicating financial stability. However, the introduction of debt in 2025 has increased the debt-to-equity ratio to 0.26, which although manageable, indicates increasing financial leverage. The return on equity stands at 20.82%, reflecting efficient use of equity to generate profits. Overall, the balance sheet remains healthy but requires careful management of debt levels going forward.

Cash Flow

The cash flow statement reveals challenges in cash generation, with operating cash flow turning negative in 2025. The free cash flow has also declined significantly, with a negative free cash flow growth rate of -133.89%. The operating cash flow to net income ratio has deteriorated, indicating inefficiencies in cash conversion. While there have been strong financing activities, the overall cash flow position requires significant improvement to ensure sustainable liquidity.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement
Total Revenue	539.86B	518.61B	461.61B	373.25B	342.87B	289.57B
Gross Profit	156.84B	164.95B	141.23B	110.52B	98.09B	92.43B
EBITDA	128.60B	119.51B	101.85B	74.42B	64.91B	62.35B
Net Income	83.30B	73.25B	77.08B	60.60B	61.66B	48.57B
Balance Sheet
Total Assets	654.56B	541.99B	393.44B	351.36B	351.11B	336.02B
Cash, Cash Equivalents and Short-Term Investments	96.64B	91.99B	62.99B	52.05B	59.03B	85.45B
Total Debt	195.65B	92.37B	17.86B	0.00	0.00	0.00
Total Liabilities	312.86B	189.82B	103.81B	57.75B	52.52B	63.28B
Stockholders Equity	341.70B	351.89B	289.62B	293.62B	298.60B	272.73B
Cash Flow
Free Cash Flow	-4.64B	-19.78B	58.35B	41.67B	36.46B	28.60B
Operating Cash Flow	-2.60B	-11.64B	65.58B	52.77B	41.97B	31.20B
Investing Cash Flow	-47.90B	-13.64B	-3.18B	12.00B	-808.60M	-28.68B
Financing Cash Flow	43.42B	42.96B	-61.93B	-71.81B	-40.56B	-195.20M

Bajaj Auto Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 9165.15
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:BAJAJ.AUTO, the sentiment is Negative. The current price of 9165.15 is below the 20-day moving average (MA) of 9704.98, below the 50-day MA of 9608.58, and above the 200-day MA of 8934.97, indicating a bearish trend. The MACD of -105.69 indicates Positive momentum. The RSI at 33.01 is Neutral, neither overbought nor oversold. The STOCH value of 6.27 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:BAJAJ.AUTO.

Bajaj Auto Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EICHERMOT	76 Outperform	₹1.85T	35.30	―	0.96%	25.37%	19.52%
HEROMOTOCO	72 Outperform	₹1.04T	22.77	―	2.90%	5.18%	27.60%
HYUNDAI	65 Neutral	₹1.64T	37.82	―	0.91%	-0.35%	-4.21%
BAJAJ.AUTO	64 Neutral	₹2.48T	23.74	―	2.31%	11.83%	13.79%
TVSMOTOR	63 Neutral	₹1.58T	52.46	―	0.27%	16.89%	38.92%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%