Bajaj Auto Q4 results: Revenue and net profit could see double-digit growth; focus on share buyback

Two-wheeler maker Bajaj Auto will announce its March quarter results on Wednesday, May 6. The Pulsar bike maker is expected to report strong earnings with double-digit growth in revenue and net profit.

According to experts, Bajaj Auto’s net profit could rise by 23% to 26% YoY to ₹2,520 to ₹2,580 crore during the quarter. The company registered a standalone net profit of ₹2,049 crore in Q4FY25. Meanwhile, the net profit may increase by 1% to 3% sequentially compared to ₹2,503 crore profit in the previous quarter.

Its revenue is expected to increase by 25% to 27% YoY to ₹15,300 to ₹15,490 crore and remain flat sequentially. The company registered a standalone revenue of ₹12,148 crore in Q4FY25, while it stood at ₹15,220 crore in the previous quarter. Meanwhile, its EBITDA margins are likely to improve by 45 to 48 bps on a yearly basis to range between 20.5% and 21.5%

Bajaj Auto could report strong quarterly earnings on back of robust sales volume which is likely to increase by 22% to 24% YoY. Higher exports, improvement in product mix and favourable currency movement will also support the earnings. Average selling prices (ASPs) is also expected to rise due to recent price hike.

During the quarterly result announcement, investors will look forward to management commentary on the demand outlook, export sales numbers, and growth in the electric 2-wheeler segment.

Ahead of the Q4 result announcement, Bajaj Auto shares closed 0.6% higher at ₹10,068. So far this year, Bajaj Auto shares have gained 7.5%. Investors will also look forward to buyback announcement by the company.

Technical outlook

Bajaj Auto is showing a stronger setup compared with the broader recent consolidation, with the stock trading above its 20-day, 50-day and 200-day EMAs. The stock closed near ₹10,046 after a sharp move above the short-term averages, indicating improving momentum. Immediate resistance is placed around ₹10,187, where the stock madebreakout attempt.

A decisive close above this zone can strengthen the bullish structure and open the way for further upside. On the downside, the ₹9,600–₹9,520 zone, near the 20-day and 50-day EMAs, will act as the immediate support.

Options outlook

The open interest data for the 26 May expiry indicates that Bajaj Auto’s at-the-money (ATM) strike of 10,100 is implying a potential price move of around ±6.2% ahead of the expiry.

To get a clear perspective on price behaviour, let's look at how Bajaj Auto's share price has performed over the eleven quarters around its earnings announcements.

Options strategy for Bajaj Auto

With the options market pricing in a potential move of ±6.2%, traders can use volatility-based strategies, such as long or short straddles, to align with their market outlook.

A long straddle involves buying an at-the-money (ATM) call and put option with the same strike price and expiry date. This strategy can benefit from a sharp price movement, beyond the expected range of ±6.2% in either direction.

Conversely, a short straddle involves selling both an ATM call and put option with the same strike price and expiry date. This strategy aims to profit from time decay if the stock price remains within the expected range of ±6.2%.

Those expecting a directional breakout or continuation may consider bull put spreads to capture further upside momentum, or bear call spreads if a breakdown from the current consolidation occurs.

Disclaimer:

Derivatives trading must be done only by traders who fully understand the risks associated with them and strictly apply risk mechanisms like stop losses. The information is only for educational purposes. We do not recommend any particular stock, securities or strategies for trading. The securities mentioned in this article are purely illustrative and not recommendations. Investors are advised to do their own research before investing.