Bajaj Auto shares fall over 5%, on planned production cut due to uncertainty in Nigeria

Bajaj Auto shares fall over 5%, on planned production cut due to uncertainty in Nigeria

Shares of Bajaj Auto Fall: Bajaj Auto share price fell over 5% to Rs 3,653 on Monday after media reports said that the two-wheeler maker is expected to take a cut of up to 25% in motorcycle and three-wheeler production across its export-focused plants next month. The company took the decision due to uncertainties in Nigeria. “Our largest market, Nigeria, will continue to be depressed and volatile till the elections get over in February-end,” Executive Director Rakesh Sharma said in an earnings call in January. Nigeria’s electoral commission began announcing results from its national elections amid complaints of irregularities, with its presidential vote expected to be the closest in the country’s history.

Bajaj Auto is likely to produce 250,000-270,000 units in March, ET reported, citing multiple sources aware of the production plans. That’s lower than its average monthly production of 338,000 units in the first nine months of FY 2023, the report added. The company’s total export volumes dropped in the December quarter to 439,088 units from 658,062 units in the same period a year earlier. Company executives, in the January earnings call, pointed to a decline in consumers’ purchasing power due to across-the-board inflation, with the weakness more pronounced in South Asia and Africa.