Bajaj MotorcyclesIndia’s emerging-market champion, Bajaj Auto manufactures and sells motorcycles, scooters and auto rickshaws. It is the world’s sixth-largest manufacturer of motorcycles and the Third-largest in India. It is the world’s largest three-wheeler manufacturer.

Particulars Bajaj Auto Ltd Hero MotoCorp Ltd TVS Motors
Market Cap
73,496 53,683 10,620
21,106 29,020 10,311
EBIT Margin 20.01% 12.84% 6.6%
Net Profit
3,025 2,364 328
Market cap/sales 3.48 1.85 1.03
Profit/unit 7,945 3,566 1,309
Two Wheeler
Total Sales
(Units in Lacs)
32.91 66.31 24
Percentage of Export Sales / Total Sales 46% 3% 13%
Three Wheeler
(Units in Lacs)
2.34 Not Applicable 0.18
(Units in Lacs)
2.84 Not Applicable 0.9

Above figures lead to two things:-

  • TVS Motors is totally in a different league.
  • Hero MotoCorp Ltd is focused on volume, while Bajaj Auto Ltd is the bottom line and contribution per unit.

Bajaj-Auto-ExportsBajaj Auto Ltd probably could do this because it focused on few products and on the world market. It introduced new products after extracting fully from existing segment and establishing its leadership position. It also gambled not to produce scooters in which it was pioneered and market leader for years through its brand Chetak.

Bajaj Auto have lost domestic market share in motorcycles —from 24.4% two years ago to 20% last year, and then to 16.5% in FY2015 ,though it continued to gain market share in key markets like Africa, Colombia, Central America, Egypt, Sri Lanka and Bangladesh. For almost all its products, there are strong market share improvements across South Asia, Africa, Middle East and Latin America and, in many cases, gained at the expense of Chinese brands. Bajaj Auto continues to be the India’s No.1 exporter of motorcycles and three-wheelers. It exports to 62 countries and enjoys the No.1 or No.2 position in 20 of them.

Both Bajaj Auto and Hero MotoCorp Ltd are the market leaders but in a different segment and through the different strategy. To maintain their leadership, next strategic step will be very crucial. Hope that each does not follow other which may end up the destruction in value for both.

Main Contributor : Navita

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