Bajaj Auto — Q4 FY26 earnings call

Call held 6 May 2026

Management summary

Bajaj Auto delivered a record-breaking Q4 and FY26, with revenues exceeding ₹16,000 crores and ₹58,000 crores respectively, driven by broad-based growth across all segments and robust operational management. The electric vehicle portfolio achieved double-digit EBITDA margins for the first time, and the company announced a 100% payout of FY26 profits to shareholders. However, management noted a softening demand environment in April, significant commodity inflation expected in Q1 FY27, and ongoing supply chain challenges impacting 10-15% of demand.

Highlights

  • Bajaj Auto delivered a record-breaking FY26 with revenues over ₹58,000 crores, EBITDA over ₹12,000 crores (20.5% margin), and PAT over ₹9,800 crores.

  • Q4 FY26 performance was strong, with revenues exceeding ₹16,000 crores, EBITDA over ₹3,300 crores (20.8% margin), and total volumes growing 24% YoY to 13.7 lakh units.

  • The Exports business unit recorded 25% YoY growth in Q4, achieving its highest ever quarterly revenue, and FY26 exports reached a record USD2.2 billion.

  • The electric 2W & 3W business achieved double-digit EBITDA margins for the first time, with Chetak becoming EBITDA-neutral, and the overall electric business now contributes over 20% of domestic revenues.

  • The Board approved a 100% payout of FY26 profits (₹9,825 crores) to shareholders via a final dividend of ₹150 per share and a ₹5,633 crores buyback.

Concerns

  • Demand environment softened in April due to general inflation, increased vehicle prices, LPG shortages, and manpower migration.

  • Motorcycle category growth is estimated to slow from 20% in Q4 to 7-9% in the near term.

  • Supply chain difficulties, including LPG shortage, manpower availability, and outbound logistics, impaired availability to service demand by 10-15%.

  • Q1 FY27 is expected to face a 'sharply inflationary, almost hyper' commodity environment, with a projected cost inflation impact of 3.5-4% of revenue.

Key financials

2 periods

Q4

  • Revenue
    ₹16,006 Cr
    YoY +32%
  • EBITDA
    ₹3,323 Cr
    YoY +36%
  • EBITDA Margin
    20.8%
  • PAT
    ₹2,746 Cr
    YoY +34%

FY26

  • Revenue
    ₹59,000 Cr
    YoY +17%
  • EBITDA
    ₹12,000 Cr
    YoY +19%
  • EBITDA Margin
    20.5%
  • PAT
    ₹9,825 Cr
    YoY +21%

What they filed

Q1 FY27: revenue up 65.1%, net profit up 44.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue13,247 13,169 12,646 13,133 15,735 +19%16,204 +23%17,832 +41%21,689 +65%
EBITDA2,073 2,751 2,358 2,793 2,829 +36%3,730 +36%3,075 +30%4,528 +62%
Net profit1,385 2,196 1,802 2,210 2,122 +53%2,750 +25%3,492 +94%3,189 +44%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Exports Business Unit
    6,00,000 units Q4 Volumes2.2 Bn FY26 Revenue
  • Domestic Motorcycles
    11% FY26 Growth
  • Probiking (KTM & Triumph)
    43,000 units Q4 Volumes
  • Chetak (EV Scooter)
    1,00,000 units Q4 Retail Sales50,000 units March 26 Retail Sales23% Q4 Market Share₹4,000 Cr FY26 Revenue
  • Commercial Vehicles
    5,00,000 units FY26 Volumes28% Q4 Volumes Growth
  • Electric 2W & 3W Business
    20% Domestic Revenue Contribution10% EBITDA Margin

Capital allocation

high confidence
  • Capex ₹500 Cr
    • ICE investments ₹250 Cr
    • EV investments ₹250 Cr
    Capex for the year was approximately INR500 crores, split equally between ICE and EV investments.
  • Dividend ₹150/share (final) Payout ratio 100%
    Lastly, the Board of Directors at its meeting earlier today approved a payout of 100% of the profits that we have made last year in recognition of the 100 years milestone of the Bajaj family in India and with Bajaj Auto being the flagship company that started it all. his will be split as follows a final dividend of INR150 per share that will aggregate to INR4,192 crores
  • Buyback ₹5,633 Cr Max ₹12,000/share · Tender route
    and the balance of about INR5,633 crores will be towards a buyback under the tender route at a buyback price of INR12,000 per share.
  • M&A Bajaj Mobility AG (via Bajaj Auto Holdings AG) Acquisition · Closed

    Moved from a minority position to a controlling stake in KTM.

    Q4 FY26 included a net share of profit from associate of INR561 crores (Jan 1 to acquisition date) and a gain of INR953 crores on re-measurement of investments at fair value.

    Bajaj Auto through its wholly owned subsidiary in the Netherlands, BAIH BV, completed the acquisition of 100% stake in Bajaj Auto Holdings AG, which was formerly called Pierer Bajaj AG, which in turn held 75% stake in the now named Bajaj Mobility AG, the listed holding entity for KTM. With the transaction completed on 18th of November, Bajaj moved from being a minority position to a controlling stake and BMAG and KTM are now step-down subsidiaries of the group.
  • Liquidity Cash ₹18,000 Cr Surplus funds over INR18,000 crores after deploying capital on multiple fronts during the year.
    We closed the year with surplus funds of over INR18,000 crores after deploying capital on multiple fronts during the year, reflecting a strong and consistent cash generation.

Guidance & targets

Volume

  • Motorcycle Category Growth Volume · near term · Medium confidence 7-9%
    This is bound to slow down the motorcycle category from its rocking 20% growth in Q4 to we estimate 7% to 9% in the near term.

    — Rakesh Sharma

  • 125cc+ Segment Growth Volume · near term · Medium confidence twice the industry rate
    the 125cc plus segment and even more so from the 150cc plus segment, which should grow at twice the industry rate.

    — Rakesh Sharma

  • Exports Volume Volume · this quarter · High confidence 220,000 units per month

    Previously 200,000 units per month → 220,000 units per month

    We are looking at moving the exports needle to 2,20,000 units per month this quarter, up from the 2,00,000 levels.

    — Rakesh Sharma

Capacity

  • Chetak Manufacturing Capacity Capacity · next 12 months · Medium confidence 60,000 units per month

    Previously 50,000 units per month usable → 60,000 units per month

    our capacity is closer to 60,000, let's say, it's 50,000 usable. So, we are seeing in the next 12 months hoping to hit that kind of thing.

    — Rakesh Sharma

Product Launch

  • New Pulsar Variants Product Launch · as early as July · High confidence new range in 125cc and 150cc+ segments
    We'll have a new range in both the 125cc and the 150cc plus range. There will be hopefully, I think we will see these new introductions hitting the market as early as July in the Pulsar brand itself.

    — Rakesh Sharma

Profitability

  • Q1 FY27 Cost Inflation Impact Profitability · Q1 FY27 · Medium confidence 3.5-4% of revenue
    Taken together, we are currently estimating a material cost inflation impact of approximately 3.5% to 4% of revenue.

    — Dinesh Thapar

  • Cost Inflation Offset by Pricing Profitability · Q1 FY27 · High confidence 40% of impact
    Once again, we have taken very judicious pricing actions to offset about 40% of this impact so far.

    — Dinesh Thapar

Incentives

  • PLI Claim Incentives · FY26 · High confidence INR900 crores
    PLI claim for the year, we're still aggregating it, but it is in the whereabouts of about INR900 crores.

    — Dinesh Thapar

KTM Integration

  • KTM Turnaround Results KTM Integration · latter part of 2026 · Medium confidence showing up
    I expect the results of this to start showing up in the latter part of 2026 itself.

    — Dinesh Thapar

What to watch in Q1 FY27

Domestic Motorcycle Growth Rate

next quarter (Q1 FY27)
Current Slowed from 20% in Q4 to 7-9% in April
Target Stabilization or recovery from 7-9% range

Why it matters

Indicates overall domestic demand health and the impact of macro factors like inflation and price hikes on consumer sentiment.

This is bound to slow down the motorcycle category from its rocking 20% growth in Q4 to we estimate 7% to 9% in the near term.

Risks & concerns

  • Sharply Inflationary Commodity Environment

    high

    Q1 FY27 is expected to face 'sharply inflationary, almost hyper' commodity prices, with a projected 3.5-4% impact on revenue, driven by increases in steel (15%), copper (20%), and aluminium/noble metals (35-45%).

    Management acknowledged

  • Softening Demand Environment

    medium

    Demand softened in April due to general inflation, increased vehicle prices, LPG shortages, and manpower migration, leading to a slowdown in motorcycle growth from 20% to 7-9%.

    Management acknowledged

  • Supply Chain Difficulties

    medium

    LPG shortages, manpower availability, and outbound logistics to overseas markets have impaired the ability to service 10-15% of demand, though the company has managed to avoid lost sales in exports.

    Management acknowledged

Q&A highlights

7 direct
Impact of price hikes and demand outlook for motorcycles and other segments Direct
Well, there has been a decline in the motorcycle industry's growth between quarter 4 and April. And there is, of course, 1st of April onwards, price hike being taken in different measures by almost all companies... So obviously, it will have some impact on the demand.

Management confirmed a slowdown in motorcycle demand post-price hikes and identified segments (upper half, EVs, exports) that are more resilient, providing crucial context for future growth.

Asked by Kapil Singh

Currency hedging strategy and realization of forex tailwinds Direct
Yes, Kapil. Short answer to that, that we're not hedged, and therefore, we are realizing at market.

Clarifies the company's unhedged currency exposure, indicating direct benefit from rupee depreciation, which is a significant tailwind in the current environment.

Asked by Kapil Singh

Outlook on exports vs domestic volume growth for FY27 Partial
But I can say one thing that export is on a very strong wicket because we are capturing a disproportionate share of the growth because of our retail presence... So therefore, I think exports will continue to do well. Like I said, in quarter 1, we definitely see it pushing the needle hopefully beyond 2,00,000 units per month also. And domestic business, whether exports will do better than domestic or not, I cannot say that.

Management expressed strong optimism for export growth, driven by market share gains and strong performance in key regions, but remained cautious on a definitive comparison with domestic growth for the full year.

Asked by Binay

Chetak capacity expansion plans to meet demand Direct
Chetak, we have not been able to fulfil the demand, which has been there for one reason or the other... And we have now a capacity of 50,000 units per month. I think we will max that... we will start looking at further enhancing our capacity in the year '27-28.

Highlights that Chetak demand exceeds current supply and outlines plans for significant capacity expansion, indicating strong growth potential for the EV scooter segment.

Asked by Binay

Upcoming new product launches, specifically affordable 125cc motorcycles Direct
We'll have a new range in both the 125cc and the 150cc plus range. There will be hopefully, I think we will see these new introductions hitting the market as early as July in the Pulsar brand itself.

Confirms new product launches in critical 125cc and 150cc+ segments, signaling a refreshed portfolio strategy to drive market share and capitalize on festive season demand.

Asked by Raghunandhan

Profitability of the EV business and the PLI incentive for FY26 Direct
we've got to a stage of double-digit EBITDA margin, which has been true for the last 2 quarters on our electric business... PLI claim for the year, we're still aggregating it, but it is in the whereabouts of about INR900 crores.

Provides clarity on the strong profitability of the EV segment and quantifies the significant PLI benefit received, which are key drivers for the company's overall performance.

Asked by Raghunandhan

Timeframe for the expected moderation in motorcycle growth (7-9%) Direct
I would say, in the next few months. At this point of time, I won't wager a full year exit.

Clarifies that the 7-9% motorcycle growth estimate is a near-term outlook for the next few months, not a full-year projection, providing a more nuanced understanding of the demand environment.

Asked by Amyn Pirani

Reasons for the jump in 'Other Operating Income' Direct
The second is obviously with scale-up of exports, there is clearly export incentives which come in which get reported on to that line. And the third is, of course, a fairly robust growth that we are seeing on our BGO or oils business and the royalty that we earn on that.

Explains the drivers behind the increased 'Other Operating Income', attributing it to PLI from EV scale-up, export incentives, and growth in the BGO/oils business and royalty income.

Asked by Amyn Pirani

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Detailed narrative

Overall FY26 and Q4 Performance Highlights

Bajaj Auto reported a defining FY26 with record performances, achieving over ₹58,000 crores in revenue, EBITDA crossing ₹12,000 crores for the first time at a 20.5% margin, and PAT exceeding ₹9,800 crores. Q4 FY26 was a standout quarter, with revenues surpassing ₹16,000 crores, EBITDA at ₹3,300 crores, and margins at 20.8%. Total volumes in Q4 reached a new high of 13.7 lakh units, growing 24% year-on-year, contributing to a 32% increase in revenues and 36% growth in PAT for the quarter.

Exports Business Unit Performance

The exports business unit had a strong quarter, crossing the 6,00,000 units mark for the second consecutive quarter and clocking 25% growth year-on-year, resulting in the highest ever quarterly revenue from exports. For FY26, the unit recorded its second-highest ever volume performance and highest ever revenue at USD2.2 billion. Latin America continued its strong growth for 11 consecutive quarters, while Nigeria showed stability in Q4 with volumes crossing 1 lakh units, matching FY25 performance. The company aims to increase exports to 2,20,000 units per month this quarter, up from 2,00,000 levels.

Domestic Motorcycle and Probiking Performance

The domestic motorcycle industry experienced a split trajectory in FY26, with a muted first half followed by a strong recovery in the second half, leading to 11% growth for the full year. Growth was primarily driven by the 125cc plus segment, which grew faster than the 100cc segment. The refreshed Pulsar portfolio, with 10 new variants and upgrades introduced between October and March, now contributes to 50% of sales. The Probiking segment (KTM and Triumph) also delivered a record domestic performance in Q4, with combined volumes of nearly 43,000 units, registering a 43% year-on-year growth. Triumph crossed the 1 lakh unit milestone within 2.5 years of inception.

Electric Vehicle Business Growth

The electric scooter business, Chetak, crossed the 1 lakh retail mark for the first time in a single quarter in Q4, with March '26 retails touching over 50,000 units. Chetak's market share increased to 23%, a gain of 170 basis points sequentially. For FY26, Chetak crossed the 5-lakh unit mark and generated ₹4,000 crores in revenue. The electric 2-wheeler and 3-wheeler business is now the largest in the auto industry, contributing over 20% of domestic revenues and achieving double-digit EBITDA margins for the first time. The company launched WEGO 9018, the largest electric 3-wheeler, in Q4, featuring a 17.7kW battery and a 296km range.

Commercial Vehicles and Spares Business

FY26 was a landmark year for the commercial vehicle business, which crossed the 5-lakh unit mark for the first time. In Q4, the business delivered its highest ever quarterly volumes, growing 28% year-on-year, with the ICE franchise remaining strong and the CNG segment holding close to 90% market share. The electric 3-wheeler segment maintained its number one position in Q4 and April. The spares business also performed well, with sales of over ₹1,700 crores, registering a 16% growth and delivering a record EBITDA margin.

Commodity and Currency Headwinds & Mitigation

Looking into Q1 FY27, the commodity environment is expected to be 'sharply inflationary, almost hyper,' with material availability issues for aluminium alloys and polymers. Key commodities like steel, copper, aluminium, and noble metals have seen increases of 15% to 45%. This is projected to result in a material cost inflation impact of approximately 3.5% to 4% of revenue. The company has taken judicious pricing actions to offset about 40% of this impact and is implementing cost optimization measures. The rupee's depreciation, reaching INR90.6 to the dollar in Q4, provided a favorable currency tailwind, helping to manage cost inflation.

Capital Allocation and Shareholder Returns

Bajaj Auto closed FY26 with surplus funds exceeding ₹18,000 crores. Capex for FY26 was approximately ₹500 crores, split equally between ICE and EV investments. The Board approved a 100% payout of FY26 profits, totaling ₹9,825 crores, to shareholders. This includes a final dividend of ₹150 per share, aggregating to ₹4,192 crores, and a buyback of ₹5,633 crores via a tender route at ₹12,000 per share. The buyback process will commence shortly and is expected to culminate by the end of July, following shareholder and SEBI approvals.

KTM Integration and Future Outlook

Bajaj Auto, through its subsidiary BAIH BV, completed the acquisition of a 100% stake in Bajaj Auto Holdings AG (which held 75% of Bajaj Mobility AG, the listed entity for KTM) on November 18, 2025. This transition from a minority to a controlling stake led to the consolidation of BMAG and KTM AG results. For Q4 FY26, the net share of profit from the associate was ₹561 crores, including a gain of ₹953 crores from re-measurement of investments. The focus for KTM in 2026 is on a broad-based turnaround plan, with results expected to show in the latter part of the year.

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