Bajaj Auto Q1 sales seen up 23%

India's second largest two-wheeler maker Bajaj Auto is expected to report 23% rise in profit after tax of Rs 726 crore for the quarter ended June 2011 as against Rs 590 crore in a year ago period.

Revenues are seen going up by 23% to Rs 4,790 crore from Rs 3,889 crore during the same period. But operating profit margin is likely to be at 19.5% versus 20%.

Key factors to watch for : * Bajaj Auto will post the strongest earnings within the auto companies 
* Total volume growth of 18% will support revenue growth 
* Margins can report some negative surprise. Management said margins to be held at 20% level 
* Realisations to increase 7% YoY (1% QoQ) due to price increase of 1.25-1.5% that the company effected in the domestic market from April 2011 and export from May 2011 
* Margins might decline marginally due to higher raw material costs (up 100 bps QoQ and 75 bps YoY ) 
* Govt has extended DEPB benefits till September 2011, post which duty drawback comes into play. Management says will raise prices further to compensate for withdrawal of DEPB

Q1FY12 Volume growth YoY-Total volume up 17.7% at 10.92 lakh versus 9.28 lakh
-Motorcycles up 16.3% at 9.63 lakh versus 8.28 lakh
-3 wheelers up 30% at 1.29 lakh versus 99918 units 
-Exports up 32% at 4.27 lakh versus 3.23 lakh
-Strong traction in Pulsar and Discover

Market share in Q1Hero honda regained market share of 282 basis points in Q1 in the domestic segment 
Hero Honda : 46.8%
Bajaj Auto : 19.6% 
TVS Motor : 14.2%

Volume comparison in Q1Hero Honda up 24% at 15.29 lakh units 
Bajaj Auto up 17.7% at 10.92 lakh units 
TVS Motor up 16% at 5.36 lakh units