New Delhi: Shares of Bajaj Auto on Thursday morning cracked over 11 per cent after the firm reported a 31 per cent year-on-year decline in consolidated profit after tax for the second quarter ended September 30, 2024.
The stock tanked 11.13 per cent to Rs 1,0540 on the BSE. At the NSE, it slumped 9.30 per cent to Rs 10,536. Bajaj Auto on Wednesday reported a 31 per cent year-on-year decline in consolidated profit after tax to Rs 1,385 crore for the second quarter ended September 30, 2024, impacted by higher expenses and a one-time hit due to an increase in its provision for deferred tax.
The company had reported a consolidated profit after tax (PAT) of Rs 2,020 crore in the July-September period of last fiscal. Total revenue from operations, however, rose to Rs 13,247 crore in the second quarter compared with Rs 10,838 crore in the year-ago period, Bajaj Auto said in a regulatory filing.
Total expenses in the second quarter were higher at Rs 10,767.22 crore as compared to Rs 8,806.47 crore in the year-ago period, the company said. "We had to make a one-time additional provision of Rs 211 crore on account of deferred tax," Bajaj Auto Executive Director Rakesh Sharma told reporters in an earnings call on the reason behind the dip in PAT.
The withdrawal of the indexation benefit which the government had given on long-term capital gains, and this withdrawal has effectively increased the effective tax rate from about 6.8-7 per cent to 14 per cent on debt mutual funds, he said, adding "that is a one-time hit, nothing to do with operations."
Shares of other major auto manufacturers fell sharply in early trading on Thursday, following Bajaj Auto's disappointing Q2FY25 financial results. Herp MotoCorp's stock dropped 3.61 per cent to Rs 5,202.40, while Maruti Suzuki India declined 2.01 per cent to Rs 12,125.
Mahindra & Mahindra saw a decrease of 2.40 per cent, trading at Rs 2,989.15. Additionally, TVS Motor Company shares fell by 3.39 per cent to Rs 2,680.0.
