Updated January 24th, 2024 at 20:01 IST
TVS, Bajaj Auto forecast challenges to export recovery
The automotive companies, which share export regions in South America, Africa, and South Asia, had faced trouble selling their vehicles overseas
Export Recovery: Two-wheeler majors TVS Motor and Bajaj Auto on January 22 forecasted lingering challenges to recovery in exports, after both automotive majors beat third-quarter profit estimates.
The successive festive and wedding seasons, periods when people prefer to make big-ticket purchases, helped TVS and Bajaj Auto post profits comfortably above analyst estimates for the quarter ending December 31 FY2024
On top of festive season, Bajaj Auto also benefited from strong demand for its premium motorcycles, led by the two Triumph models.
The two-wheeler makers extended strong profits from Q2 FY2024, which had propelled their stocks and the Nifty Auto index to record highs. Still, exports remain a roadblock.
The automotive companies, which share export regions in South America, Africa, and South Asia, had faced trouble selling their vehicles overseas.
In a post-earnings call, Dinesh Thapar, Bajaj Auto's Financial Chief, said, "(Export demand) is inching its way back, but still far from where we would like to see it."
The Pulsar motorcycle-maker's two-wheeler exports fell 3 per cent year-on-year in the quarter ended December 31, 2023, while TVS' two-wheeler exports rose close to 4 per cent.
Currently, currency depreciation challenges persist in Africa, one of TVS' largest export markets, CEO of TVS Motor Company, K. N. Radhakrishnan, said in a post-earnings call.
The companies have been attempting to expand their international presence, with TVS entering the European market through an import-and-distribution agreement with Emil Frey.
Bajaj Auto's Thapar said that the company has started exports of its Triumph motorcycles to the United States, the UK, Japan, Australia, and Poland markets.
"In the quarter, of the 15,000 units of Triumph we sold, about 7,000 went to export markets," he said. Currently, exports make up about 20 per cent of TVS' two-wheeler sales and 37 per cent of Bajaj Auto's sales volume.
(With Reuters Inputs)
Published January 24th, 2024 at 20:01 IST