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Bajaj Auto Q2 net up 167 pc -- Profit lifted by payment from Allianz

Our Bureau

MUMBAI, Oct. 24

BAJAJ Auto Ltd (BAL) has reported a 166.95 per cent rise in profit after tax for the July-September 2001 quarter (Q2), to Rs 143.70 crore from the previous corresponding Rs 53.83 crore.

Total sales and other income in Q2 rose by 10.02 per cent to Rs 1,170.05 crore (Rs 1,063.45 crore). Sales and income from operations increased by 7.23 per cent to Rs 1,057.12 crore (Rs 985.81 crore), while other income moved up by 44.03 per cent to Rs 10 3.73 crore (Rs 72.02 crore).

``Non-operating income for the second quarter includes a sum of Rs 72 crore received as premium from Allianz AG for the company's life insurance venture. The total premium received by the company amounts to Rs 117 crore while the investment in the insura nce ventures with a 74 per cent stake, stands at Rs 193 crore,'' an official statement said.

When contacted, a senior BAL official said that with the two tranches of premium payment got over the first and second quarters of current fiscal, the flow of such receipts from Allianz stood completed.

Depreciation in Q2 touched Rs 44.59 crore (Rs 42.17 crore), interest outgo was Rs 1.12 crore (Rs 1.28 crore) and provision for tax, Rs 46 crore (Rs 3 crore). EPS touched Rs 56.16 (Rs 20.56).

For the first half of 2001-2002, BAL had total sales and other income of Rs 2,192.37 crore (Rs 2,081.94 crore), with profit after tax of Rs 264.47 crore (Rs 170.15 crore).

Product sales for Q2 was as follows: Motorcycles - 1,52,312 (1,16,880); geared scooters - 96,851 (97,474); ungeared scooters - 17,974 (22,135), step thrus - 16,254 (29,240) and 3-wheelers - 44,322 (47,828).

Total 2 & 3-wheeler sales for BAL, during the period, was 3,27,713 units (3,13,557 units). For the first half, the corresponding figure was, 6,41,060 units (6,38,917 units).

``Though in last fiscal the first half accounted for a higher portion of sales, this year we expect the traditional model of a stronger second half to hold true,'' the BAL official said.

``The drive towards reducing costs through initiatives in indigenisation, value engineering, supply chain management and review of fixed costs with special focus on the motorcycle segment has started yielding dividends,'' the statement said. EBITDA as a percentage of net sales and other operating income, which stood at 9.8 per cent for 2000-2001, has increased to 13.7 per cent in the first half.

The BAL official said the process of matching margins in motorcycles with the BAL's known good margins in geared scooters ``is going on.'' Motorcycles currently constitute 42 per cent of BAL's total volumes and 40 per cent of total sales in value. The co mpany's geared scooter sales in current financial, dipped from the quarter's 1,23,974 units to 96,851 units.

A 5-day week continues at the company's Akurdi plant manufacturing geared scooters.

The official declined to put a figure to the estimated savings accruing to BAL in 2001-2002 from ongoing cost cuts, and whether such savings would be higher than at present in the remaining quarters of the fiscal.

In response to BAL's VRS offered in June 2001, 171 employees opted for the same. A total of Rs 6.78 crore has been paid on this account, one third of it already provided for in the accounts, the balance to be charged equally over the next two quarters.