Strong year-on-year growth in retail sales in the festive season has helped Bajaj Auto Ltd. Executive Director Rakesh Sharma lift his annual growth outlook for India’s two-wheeler industry back to 6–8% in fiscal 2025.
Sharma is optimistic even as Bajaj Auto reported muted year-on-year growth in October sales. The company's total sales grew 2% to 4.8 lakh units, commercial vehicle sales were up 4% at 65,335 units and total two-wheeler sales grew 2% to 4.14 lakh units, according to an exchange filing. Total exports during the month grew 24% to 1.75 lakh units.
Sharma, in conversation with NDTV Profit's Tamanna Inamdar, decoded the festive sales numbers, comparing festive retail sales from Oct. 3 to Oct. 31 this year to when it fell between Oct. 15 and Nov. 12 last year.
"This frame has been a smashing for us as well as the industry, particularly last two weeks," he said, adding that festive sales could have gone worse.
"I think customers coming back in such strong numbers indicates that after the dip, which is expected in November and December, things should be looking good, back to 6–8% annual growth for industry," he said.
At the same time, festive season did start slow as run-up to Dusshera was a bit slow and we exited Q2 slower, Sharma said, attributing this to the company's lower annual growth industry outlook of 5-6%.
Bajaj Auto’s Caution On Festive Season Sales Doesn’t Really Add Up
“We had said that the industry is in the 5–8% zone. I would still say maybe not 8%, but probably closer to 5%," Sharma had said in the second quarter earnings call.
The entry-level market is in decline, and the 125cc+ is showing 5–6% growth. So, overall, it is coming to 1–2% growth right now. That trend is very clear now, he had said.
However, this has changed now, as the last couple of weeks in Diwali market have been smashing and "has lifted our performance, as a result of which, forecast going ahead is back to 6–8%", he said.
On its October sales data, Sharma said billing data really clouds the actual picture. He noted that its focus area of 125cc+ segment, which is almost 53% of the motorcycle industry, has grown upwards of 20% year-on-year in festive season in retail terms. "Overall retail growth is of about 11–12%," he said, adding that over two lakh Pulsar motorcycles were sold in festive periods.
Retail sale of 36,000 units of Chetak was also an all-time high, according to Sharma and three-wheelers have come in with retail sale of 56,000 units. EV retail sales growth was in triple digits in the festive period, he said.
"This exit from April–October creates confidence for next six months," he said and added that market share estimate in its chosen segment will sooner or later reflect in Vaahan data. "This part of the industry has grown less than 21%, and fast growth has garnered some market share for us," he said.
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