Mumbai: Bajaj Auto Ltd, India’s second largest motorcycle manufacturer, beat estimates with a 2% rise in net profit in the quarter to the end of September, but its operating margin slipped as sales fell across its portfolio.
Sales by the world’s largest manufacturer of three-wheeled rickshaws used for passenger and goods transportation have been hit by high interest rates and increased fuel costs in India and a tax hike in its important export market in Sri Lanka.
“The quarter was a challenging quarter for the industry at large,” the company said in a statement on Saturday.
Bajaj’s operating margin—the best in the industry—slipped to 19.7% during the quarter, down from 20.1% a year earlier, as domestic sales of its motorcycles fell 12%, a larger fall than the overall market.
Bajaj owns 47.3% of Austrian motorcycle company KTM AG and has a tie-up with Japan’s Kawasaki Heavy Industries Ltd. Its market share in India has been challenged by overseas rivals such as Honda Motor Co. and Yamaha Motor Co. Ltd.
Net profit in the second quarter of the fiscal year that began in April stood at Rs.7.41 billion ($138 million), up fromRs.7.26 billion a year previously, beating market expectations of Rs. 7.24 billion, according to Thomson Reuters I/B/E/S.
Net sales fell 3.5% to Rs.48.17 billion. Reuters