Why is growth concentrated in premium segments and EVs while 100-125cc remains weak despite GST cut?

Rakesh Sharma explained a K-shaped recovery: upper-income consumers drive premium and EV adoption; lower-income consumers face inflation, LPG cost pressure, and sentiment hit. EV adoption accelerated as fuel prices surged, cannibalizing ICE scooters. The 100cc segment is under secular decline from 55% to 46% of motorcycles in 5-7 years, and Bajaj will participate on its own profitability terms.

What is the exact launch timeline for the new Pulsar models and the two new brands in 125cc?

Rakesh Sharma confirmed: 10 new variants (facelifts) and two all-new Pulsar models (150cc and 125cc) will roll out within the next 6 weeks, starting August 1st. The two new brands in 125cc with distinct propositions are expected within the fiscal year. He emphasized the portfolio makeover is imminent and should shake up the industry.

Can the lower other-expenses ratio be sustained given upcoming launches?

Dinesh Thapar stated that discretionary and establishment fixed costs will remain very tight in Q2FY27, while marketing and activation spends needed for new model launches will not be cut. The firm is disciplined on fixed overheads but will invest behind competitiveness.

Is declining overall wholesale motorcycle market share a strategic acceptance, and will the new launches reverse it?

Rakesh Sharma emphasized using Vahan registrations, not wholesale, to judge competitiveness. He acknowledged losing share in 100cc on their own terms (profitability over volume). In 125cc+, the turnaround is underway with market share gains in 150cc+, and the imminent 125cc launches are expected to replicate that success and lift overall share.

Will India become the global manufacturing hub for KTM and how is R&D collaboration expanding?

Rakesh Sharma insisted KTM will be run independently, but India’s competitiveness makes it a preferred manufacturing base. Co-design and manufacturing collaboration, disrupted earlier, have resumed with more strength. Bajaj will supply on arm's-length competitive benchmarks; substantial manufacturing in India is expected but not a complete hub.

What is the profitability of the e-two-wheeler and e-three-wheeler business?

Dinesh Thapar (in closing remarks) clarified that the overall EV portfolio margin remains double-digit EBITDA. Within that, Chetak has moved from EBITDA neutral to EBITDA positive, complementing the growing scale of profitable electric three-wheelers.

Bajaj Auto Q1 FY27 Earnings Call — Analysis (NSE: BAJAJ-AUTO)

Bajaj Auto delivers record Q1FY27 volumes, revenue, and profit despite hyperinflationary commodity costs and supply-chain disruptions, driven by surging exports and EV scale.

27 Jul 2026 · Analysis by Alpha Inflection

The take

Q1FY27 Revenue ₹17,244 Cr ( +37% YoY ) . New guidance — Q2FY27 export volumes (monthly units) beyond the 2,50,000 per month . New story: Export breakout and broad-based global outperfo… .

Results

Revenue ₹17,244 Cr +37% YoY; EBITDA ₹3,596 Cr +45% YoY; EBITDA margin 20.9% (+10bps QoQ); PAT ₹3,000 Cr +42% YoY; volumes 1.4 mn units +29% YoY.

Financial highlights

Bajaj Auto Q1 FY27 reported figures
Metric	Value	Change	Basis
Revenue	₹17,244 Cr	+37%	yoy · Q1FY27
EBITDA	₹3,596 Cr	+45%	yoy · Q1FY27
EBITDA margin	20.9%	+10 bps	qoq · Q1FY27
Profit After Tax	₹3,000 Cr	+42%	yoy · Q1FY27
Total Volumes	1.4 mn units	+29%	yoy · Q1FY27
Export Volumes	732,000 units		point_in_time · Q1FY27 · Q1FY27 record
Free Cash Flow	₹2,300+ Cr	+100%	yoy · Q1FY27 · almost double YoY
Surplus Cash	₹21,000+ Cr		point_in_time · Jun-26 · end of Q1FY27, before ₹10,000 Cr dividend/buyback in July

Guidance

Monthly export volumes expected to exceed 250,000 units from Q2FY27; overall capacity being expanded from 7 mn to 9 mn units per annum progressively.

What management committed to

Monthly [export] volumes to surpass 250,000 units from Q2FY27 onwards. — beyond the 2,50,000 per month, Q2FY27
Overall capacity expanded by ~25% from current 7 million units per annum to 9 million units per annum, focusing on EVs, high-end motorcycles and three-wheelers. — 9 million units per annum
Within the next 6 weeks (by early Sep-26), [Bajaj Auto] will launch an all-new 150cc Pulsar, an all-new 125cc Pulsar, and 10 facelifts in the 160cc-400cc range, completing the portfolio makeover. — 1 new 150cc, 1 new 125cc, 10 facelifts, Q2FY27
Two new brands (distinct from Pulsar) will be introduced in the 125cc segment within FY27, targeting a full spectrum of customers and upgrading 100cc buyers. — 2 new brands, FY27
Chetak (e-scooter) production capacity will be unlocked to 60,000 units per month in the immediate term. — 60,000 units, immediate term
[Bajaj Auto] expects the EV portfolio (two-wheelers and three-wheelers) to continue delivering double-digit EBITDA margin. — double-digit
[Bajaj Auto] will continue to support KTM AG's turnaround and bring it back to normative levels. — normative levels
Discretionary and establishment fixed costs will remain tightly controlled in Q2FY27, while marketing investment behind new launches will not be cut. — Q2FY27
Surplus cash is expected to rebuild to approximately ₹15,000 Cr by the end of FY27, after the July dividend and buyback payout. — ₹15,000 crores thereabouts, FY27

Key themes

Export breakout, EV profitability, and portfolio makeover

How the narrative shifted

Export breakout and broad-based global outperformance: Exports have established an outstanding growth momentum, with Africa doubling retail and LatAm driving corporate EBITDA; Bajaj sees 250k/month as a new normal from Q2.
Domestic motorcycle portfolio refresh as turnaround catalyst: A comprehensive product-led makeover of the 125cc+ segment is imminent, with early evidence of market share gains in 150cc+; the full launch blitz within 6 weeks is positioned to reset competitive dynamics.
EV scaling and profitability turning positive: Chetak became EBITDA positive, overall EV portfolio double-digit margins; capacity expansion and network build-out to capture rapid industry growth and future segmentation.
Hyperinflationary commodity environment and cost resilience: Commodity inflation hit 4.5% of revenue—more than the previous two fiscal years combined—yet margins expanded sequentially via pricing, currency, mix, and cost discipline.
Capacity constraints as growth bottleneck and expansion response: Multiple businesses hit capacity ceilings; a 25% capacity increase to 9 mn units has been initiated, but immediate unlocks of 10-20% are expected through productivity and vendor debottlenecking.
KTM AG turnaround and Bajaj-KTM synergy revival: KTM restructuring progressing; manufacturing normalizing; co-design projects with Indian R&D are reviving, with India as a competitive manufacturing base, but brand independence is underscored.
K-shaped demand divergence in India: Premium motorcycle segments growing 20%+ while entry segments are flattish, reflecting a K-shaped consumption pattern that Bajaj is positioning itself to ride, while maintaining ‘own terms’ profitability in 100cc.

Operational commentary

Exports established a new high of 732,000 units (USD 735 mn revenue), now 40% of total revenue; broad-based growth across all regions except MENA, outpacing industry 2x in top 30 markets.
Africa retail doubled YoY led by Boxer 125 Heavy Duty; Nigeria pre-election institutional demand drove near-60% retail market share.
Latin America outperformed strongly, especially Mexico (3% tariff advantage, wide distribution) and Brazil; LatAm now a meaningful contributor to corporate EBITDA.
KTM motorcycle exports from India revived, +20% YoY; Triumph exports +40% YoY; three-wheeler exports hit record 100,000 units, +70% YoY, >65% share of India's 3W exports.
Domestic motorcycle portfolio makeover underway: 150cc+ segment outperforming industry 1.5x; N and NS series now 60% of 150cc+ sales; Vahan market share gained in last 5 months.
Imminent launch of an all-new 150cc Pulsar, 10 facelifts in 160cc-400cc range, and an all-new 125cc Pulsar plus upgrades within 6 weeks; two new 125cc brands planned for FY27.
Pro-biking (KTM+Triumph) domestic volumes ~40,000 units, +50% YoY; 90 joint KTM-Triumph stores operational; KTM Adventure and Triumph Scrambler lead adventure category.
Chetak e-scooter volumes grew ~80% YoY, highest ever quarter; EBITDA turned positive; capacity constrained at 50,000 units/month, immediate unlock to 60,000; network at 530+ exclusive stores, 4,500 touch points across 850 cities.
Three-wheeler (ICE+EV) highest-ever billings and retail; L3 e-rick Riki launched, present in ~150 cities; wide-body EV model 7012 a runaway success.
KTM AG turnaround on track: manufacturing ramped up, inventories normalized; Bajaj Auto continues to support management.
Quarter marked by hyperinflationary commodity costs (~4.5% of revenue, exceeding prior two fiscal years combined) and multiple supply-chain/logistics disruptions, yet EBITDA margin expanded sequentially.
Rupee depreciation cushion (realized USD/INR 94.4 vs 90.6 QoQ) helped absorb inflation; calibrated pricing recovered ~half of commodity cost increase.
Capacity expansion program initiated to raise total annual capacity from 7 mn to 9 mn units, focused on EVs, high-end motorcycles and three-wheelers.
BACL (Bajaj Auto Credit) AUM crossed ₹20,000 Cr, +70% YoY; PAT ₹227 Cr, >100% YoY; ROE >25%.

Analyst Q&A

Q. Why is growth concentrated in premium segments and EVs while 100-125cc remains weak despite GST cut?
Rakesh Sharma explained a K-shaped recovery: upper-income consumers drive premium and EV adoption; lower-income consumers face inflation, LPG cost pressure, and sentiment hit. EV adoption accelerated as fuel prices surged, cannibalizing ICE scooters. The 100cc segment is under secular decline from 55% to 46% of motorcycles in 5-7 years, and Bajaj will participate on its own profitability terms.
Q. What is the exact launch timeline for the new Pulsar models and the two new brands in 125cc?
Rakesh Sharma confirmed: 10 new variants (facelifts) and two all-new Pulsar models (150cc and 125cc) will roll out within the next 6 weeks, starting August 1st. The two new brands in 125cc with distinct propositions are expected within the fiscal year. He emphasized the portfolio makeover is imminent and should shake up the industry.
Q. Can the lower other-expenses ratio be sustained given upcoming launches?
Dinesh Thapar stated that discretionary and establishment fixed costs will remain very tight in Q2FY27, while marketing and activation spends needed for new model launches will not be cut. The firm is disciplined on fixed overheads but will invest behind competitiveness.
Q. Is declining overall wholesale motorcycle market share a strategic acceptance, and will the new launches reverse it?
Rakesh Sharma emphasized using Vahan registrations, not wholesale, to judge competitiveness. He acknowledged losing share in 100cc on their own terms (profitability over volume). In 125cc+, the turnaround is underway with market share gains in 150cc+, and the imminent 125cc launches are expected to replicate that success and lift overall share.
Q. Will India become the global manufacturing hub for KTM and how is R&D collaboration expanding?
Rakesh Sharma insisted KTM will be run independently, but India’s competitiveness makes it a preferred manufacturing base. Co-design and manufacturing collaboration, disrupted earlier, have resumed with more strength. Bajaj will supply on arm's-length competitive benchmarks; substantial manufacturing in India is expected but not a complete hub.
Q. What is the profitability of the e-two-wheeler and e-three-wheeler business?
Dinesh Thapar (in closing remarks) clarified that the overall EV portfolio margin remains double-digit EBITDA. Within that, Chetak has moved from EBITDA neutral to EBITDA positive, complementing the growing scale of profitable electric three-wheelers.

View source

Research and educational content only. Not investment advice.