Shares of Bajaj Auto Limited traded over one percent lower at Rs 9,534 in morning trade on July 8 after international brokerage UBS issued a ‘sell’ recommendation following the company’s launch of India’s first CNG bike.
UBS set a target price of Rs 6,250, implying a potential downside of 35 percent from current market levels. The brokerage believes the future lies in electric vehicles (EVs) and that CNG motorcycles will not slow the market’s shift towards electrification. Bajaj Auto recently introduced a 125cc CNG motorcycle priced between Rs 95,000 and Rs 1,10,000.
The introduction of CNG bikes is expected to impact the 100-110cc and entry-level 125cc motorcycle segments in the medium term, where Hero currently holds a 66 percent market share.
Bajaj Auto reported a 5 percent year-on-year growth in total vehicle wholesales, including exports, reaching 3,58,477 units in June. The company sold 3,40,981 two-wheelers and commercial vehicles in June 2023. Total domestic sales, including commercial vehicles, rose 8 percent to 2,16,451 units compared to 1,99,983 units in the same month last year. Total exports increased by 1 percent to 1,42,026 units from 1,40,998 units in the previous year.
At 10:20 am, shares of Bajaj Auto were trading at Rs 9,597, down 0.4 percent from the last close on the NSE. Despite this, Bajaj Auto shares have surged 41 percent since the start of the year.
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