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Bajaj Auto Profit Falls 45% In Q4

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Bajaj Auto, India's second-largest motorcycle maker, maintained its industry-leading profit margins in its fiscal fourth quarter as robust sales growth helped offset rising commodity prices.

The world's third-largest manufacturer of motorcycles rode a 26 per cent rise in exports to post quarterly sales in excess of 1 million vehicles for the fourth consecutive quarter.

"Despite input cost pressures, better realization from exports enabled the company to declare ... earnings before interest, tax, depreciation and amortisation of Rs 972 crore," Kevin D'sa, president (finance) said in a statement.

The company said its operating margin before interest, tax, depreciation and amortisation stood at 20.7 per cent in the March quarter, although profit fell 45 per cent, missing estimates, due to lower exceptional income.

Net profit fell to Rs  772 crore from Rs 1,400 crore in the year-earlier period when the earnings were boosted by an exceptional income of Rs 725 crore. Revenue rose 12 per cent to Rs 4,516 crore.

Analysts had on average expected the company to post profit of Rs 794 crore on revenue of Rs 4,871 crore.

Bajaj said net profit before exceptional items rose an annual 18 per cent during the three months to March 31.

Sales of motorcycles and scooters -- family vehicles for millions in Asia's third-largest economy -- grew 12 per cent in the year to March, partly benefiting from a slowdown in sales of small cars after a series of interest rate increases.

But Bajaj and its local rivals Hero MotoCorp and TVS Motor are starting to come under pressure from Japanese manufacturers such as Honda Motor Co, as they ramp up activity in the fast-growing market.

The Indian company slipped a place to third position in terms of domestic two-wheeler sales in March, before climbing back above Honda last month.

Shares in Bajaj, valued at about $8.6 billion, marginally pared losses after the results. The stock was down 1.1 per cent at 0810 GMT in a Mumbai market up 0.5 per cent.


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