Bajaj Auto: Strong Q1- Earned not given

Research evidence excerpt

Bajaj Auto: Strong Q1- Earned not given

Venugopal Garre +65 6326 7643 venugopal.garre@bernsteinsg.com 22 July 2026

better economics. Management was candid that legacy portfolio drag will persist for a few more quarters even as the new

range scales, simply because a franchise this large cannot be refreshed overnight without alienating loyal, geography-specific

customer pockets.

EXHIBIT 3: Bajaj’s industry beating growth in 150-250cc segment post the model refreshes in the segment

-10%

150-250cc Growth: Industry vs Bajaj

-20%

60% -34% -30%

50% -40%

40%

30%

20%

10%

0%

-30% Product refresh

-40% in Q3FY26

Q1 FY2025 Q2 FY2025 Q3 FY2025 Q4 FY2025 Q1 FY2026 Q2 FY2026 Q3 FY2026 Q4 FY2026 Q1 FY2027

Domestic Indutry 150-250cc Growth Bajaj 150-250cc Growth

Source: SIAM, Company Data, Bernstein analysis

Demand context: The K-shaped economy?

One of the more candid moments on the call came when management was asked why below-125cc demand remained weak

even after the GST cut, while premium segments continued to hold up. The response went beyond product-cycle explanations:

management attributed the divergence to what is effectively a K-shaped Indian economy, where the upper half of consumers

has grown much stronger while the segment lower down the pyramid has weakened, a dynamic reinforced this quarter by the

LPG-led commute cost shock. This was offered as a structural observation - motorcycle industry growth of 7-8% masked a

split where 150cc-plus and 250cc-plus segments grew over 20%, even as 100cc and 125cc growth slowed to low single

digits. It's a useful macro data point independent of Bajaj specifically, and one worth flagging as it helps tracking discretionary

consumption more broadly.

INDIA AUTOS 3