India’s second-largest motorcycle manufacturer Bajaj Auto has posted an unexpected drop in profit for its financial quarter to 30 September after being hit by a one-off additional tax bill.
Net sales revenue for the three-month period rose by 15 per cent to £588m. Revenue attributable to exports during the quarter was up by 29 per cent to £276m. But net profit nose-dived by 30 per cent to £60m. This followed settlement of eight years’ worth of disputed taxes amounting to £34m, owed to the government of Uttarakhand State — where one of Bajaj’s plants is located.
While Bajaj continues to lose Indian market share to Japanese competitors, its export drive (including a contract manufacturing relationship with KTM) is increasingly successful. Although Bajaj domestic motorcycle sales volume fell by 12 per cent to 952,492 units in the first half of its current financial year to 30 September, exports shot up by 30 per cent to 821,519 units over the same period.