BAJAJ AUTO LTD

PRESENTED
RESENTED BY:
BY:
AMITANSHU
MITANSHU SRIVASTAVA.
SRIVASTAVA.
ANKHI
NKHI CHATTERJEE.
CHATTERJEE.
ANIRUDDHA
NIRUDDHA DARIPA.
DARIPA.
ANKUR
NKUR GOLCHHA.
GOLCHHA.
ABHIRUCHI
BHIRUCHI CHANDGOTHIA.
CHANDGOTHIA.
HISTORY:
 Founded in 1926 by JAMNALAL BAJAJ.
 Bajaj Auto started its operations in 1945, as in importer of two and
three wheelers.
 BUSINESS:
Bajaj Auto makes five kinds of motorcycles, two kinds of
Scooters and eight kinds of three wheelers.
 PARTERSHIP:
Bajaj Auto has a technical tie-up with Kawasaki Heavy
Industries of Japan to produce a range of the latest, state-of-art
two-wheelers in India.
 LOCATION:
Bajaj Auto has three plants in Maharashtra, at Akurdi, Waluj
and Chakan.
PRODUCT PORTFOLIO:

 Bajaj Pulsar 150 DTSi  Bajaj Sunny

 Bajaj Discover  Bajaj Chetak
 Bajaj Avenger  Bajaj Cub
 Bajaj Platina  Bajaj Super
 Bajaj Kawasaki KB 100 RTZ  Bajaj Wave
 Bajaj Boxer  Bajaj Legend
 Bajaj Caliber  Bajaj Bravo
 Bajaj Pulsar 220 DTS-Fi
 Bajaj Krystal

 Bajaj Blade
UPCOMMING MODELS:  Bajaj Sonic
 CONFINES OF THE CASE :

 No Comparative sales of scooters and bikes.

 No information on cost / vehicle.

 No information on the realization / vehicle.

 HOW BAJAJ STACKS UP:
 BAJAJ FACES FIERCE COMPETITION IN HOME
GROUND NAMELY FROM HERO HONDA & TVS .

 HERO HONDA HAS TAKEN THE LEAD IN VOLUMES

AND MARKET SHARE OVER BAJAJ .

 BAJAJ IS STRONG IN ENTRY LEVEL AND

PREMIUM SEGMENT, BUT DOESN'T HAVE A
STRONG PORTFOLIO IN EXECUTIVE SEGMENT.
 BAJAJ: INVESTMENT IN SURPLUS FUNDS
As at 31 %to Total As at 31 % to Total
March 2003 March 2002

Govt. Securities & 8,653 29.7 5,797 25.6

Bank Deposits

Mutual Funds including UTI 1,739 6.0 510 2.3

Debentures & Bonds 8,698 29.4 4,040 17.9

Preferences Shares 854 2.9 917 4.1

Inter Corporate 1,651 5.7 2,609 11.6

Deposits

Loan to Bajaj auto holding Ltd 140 0.5 184 0.8

Fixed income investments 21,735 74.7 14,057 62.3

Equity Shares based on 7,355 25.3 8,499 37.7

Mutual Funds

Total Cost 29,090 100.0 22,556 100.0

Market Value 29,433 21,235

COMPARETIVE INCOME STATEMENT

PARTICULARS 2002 2003

Net Sales 4172.1 4829.37
PBIT 705.22 804.12
Less Interest 3.38 1.12
PBT 701.84 803
Less Tax 183.68 268.36
PAT 518.16 534.64
Net Fixed Assets 1368.28 1298.23
Net Current Asset 1989.83 2155.14
Average Fixed Assets 1365.31 1333.25
Average Current Assets 2025.73 2072.48
Average Assets 5024.74 5858.8
Average Equity 215.36 215.36
 DUPONT ANALYSIS
Particulars 2002 2003

PBT 701.84 803

PAT 518.16 534.64

= TAX COVERAGE MARGIN .738 .665

PBIT 705.22 804.12

PBT 701.84 803

= INTEREST COVERAGE MARGIN .995 .999

 DUPONT ANALYSIS
PARTICULARS 2002 2003

NET SALES 4172 4829.37

PBIT 705.22 804.12
= GROSS PROFIT MARGIN 0.207 0.202

NET SALES 4172 4829.37

AVG ASSETS 5024.74 5858.8
= AVG ASSETS TURNOVER 0.830 0.824

AVG ASSETS 5024.74 5858.8

AVG EQUITY 101.19 101.19
= EQUITY MULTIPLIER 49.66 57.90
 DUPONT ANALYSIS
PARTICULARS 2002 2003
TAX COVERAGE MARGIN .738 .665
INTEREST COVERAGE MARGIN .995 .999
GROSS PROFIT MARGIN .207 .202
AVG ASSETS TURNOVER .830 .824
EQUITY MULTIPLIER 25.11 29.3

RETURN ON EQUITY 316.79 323.98

RATIO ANALYSIS:

BAJAJ AUTO HERO HONDA

Current Ratio 1.20 0.16

BAJAJ AUTO HERO HONDA

Debt –Equity Ratio 0.26 0.16
Interest Coverage 717.76 33.85

BAJAJ AUTO HERO HONDA

PAT (NNRT)as % of sales 17.50 67.10

Return on Capital Employed 21.47 94.64

BAJAJ AUTO- A MYOPIC VISION

 Complacent.

 License Raj Syndrome.

 No technological up gradation of products.

 High disposable ideal cash.

 Risk averse investment portfolio.

 BAJAJ- A MYOPIC VISION :
CONTINUED

 Didn’t foresee future trendz .

 Bajaj was a late riser to the competition.

 No long lasting foreign jv’s

 Lack of professional management team.

BAJAJ MATRIX
BAJAJ MATRIX
PULSAR SCOOTERETS

AUTO SCOOTERS
 SWOT ANALYSIS :
STRENGTH
High economies of scale.
High economies of scope.
Legacy of brand name.
Widespread distribution network.
OPPORTUNITIES
The growing gearless trendy
scooters and scooterette market.
 Can use the existing R&D
capabilities for new models.
Can invest and grow the life style
segments.
WEAKNESS
Hasn't employed the excess cash for
long.
Centralized paternalistic
management style Not a global player
in spite of huge volumes.
No collaboration with any of the
foreign players .
THREATS
The competition catches-up any
new innovation in no time.
Threat of cheap imported
motorcycles from China.
Tough competition faced by foreign
as well as domestic players.
 MARKET SHARE
Mkt share Motorcycle/Stepthrou's 2002- Mkt share 3-wheelers 2002-03
03
2%
Bajaj Auto
24% Hero Honda 15% Atul Auto
TVS Bajaj Auto
44%
Yam aha 9% Bajaj tempo
6%
Others M&M
4% Piaggio vehicles
18%
8% 70%

scooters/scooterette moped
motorcycle/step-throu's Mkt share Scooter/Scooterette 2002-03
6000000

5000000 25%

4000000 Bajaj Auto

39%
3000000 HMS

2000000 TVS
17%
1000000 Others
0
FY96 FY97 FY98 FY99 FY00 FY01 FY02 FY03 19%
 Sales - Value wise break up (Rs mn)
Sales value (Rs mn) 2002-03
Motorcycles 26,082
Scooters geared 5,261
Scooters ungeared 1,254
Step thru’s 981
Three wheelers 11,542
Spare parts 2,324

Sales - percentage break up

Sales break up % (value) Sales break up
2002-03 % (volumes) 2002-03

Motorcycles 55 60
Scooters geared 11.1 18.6
Scooters ungeared 2.6 4.2
Step thru’s 2.1 3.8
Three wheelers 24.3 13.4
Spare parts 4.9 -
 HH.TVS,HONDA

HH, TVS , HONDA

NO
PROBLEM
IN THIS
QUADRANT

CONSUMERS
ADVENT OF WERE
BIKES AND BECOMING
DEMAND OF DEMANDING IN
PERSONAL TERMS OF
MOBILITY CHOICE
 OUR TAKE: VER 1.0

They should have introduced new products across

segments.

The company should have anticipated the change in market

dynamics and introduce bikes earlier then they did.

They should have increased the customer –centric

initiatives and command more loyalty.


 OUR TAKE : VER 2.0
 Bajaj should have discarded the notion of
being the numero- uno and should have
moved with times.

 Investments should have been made in high

yeilding avenues.

 The company should have sustained their

JV’s for long term synergies.
THANK YOU