Bajaj Auto: "Humara Bajaj"---Sports Bike In The Pipeline & Its Raining Too---Is It Enough To Push The Stock To 2350-2650 Zone ?

Technically, for Bajaj Auto (CMP:2191), immediate good support is around 2170 zone & sustain above 2196-2215 area, its immediate to short term target may be 2240-2255 & 2348-2365. Consecutive closing above 2365, it may scale 2495-2595 & 2695-2795 in the mid to long term.(Bullish scenario).

On the downside, sustain below 2150, immediate support may be around 2115-2085 & consecutive closing below 2085, it may further fall to 2034-2001-1972-1932-1905-1880 zone in the near term (worst bear case scenario).

Bottom Line: Technical Trading Levels(Positional)

	SL</>10	FROM SLR
		BAJAJAUTO	CMP	2191
			T1	T2	T3	T4	T5	T6	T7	SLR
Strong >	2170		2196-2215	2240-2255*	2285-2307	2348-2365*	2495	2595	2695	<2150
Weak <	2150		2115-2085*	2034	2001	1972	1932	1905*	1880	>2170

 Q4 result of Bajaj Auto was slightly below market expectations largely due to higher other expenses & employee benefit costs (i.e. one time exceptional). It was also affected due to some uncertainty in its export market, specially in Nigeria. Its export/international business contributes around 50% of its overall revenue. The stock was also under pressure due to projected weak rural demand for poor monsoon factor.

Looking ahead, progress & distribution of actual monsoon seems not so bad as projected by IMD so far & SKYMET is still maintaining its normal forecast of monsoon this year. Thus likely rural demand may not be so bad as being estimated by the street. Also, normalcy is returning along major geographical markets, growth in exports will be back on track (as guided by the management). They are also aiming growth of around 25% in sales by FY-16.

The company is also in the process of launching (by 2015) Sports Bike (Bajaj Pulsar Cruise-CS-200 & 400), which may help it to achieve the targeted growth in the days ahead.

As par quick BG metrics, current median valuation of Bajaj Auto may be around 2275 & projected ones may be around 2500-2700  (FY:16-17)

SCRIP	EPS(TTM)	BV(Act)	P/E(AVG)	LONG TERM	SHORT TERM	MEDIAN VALUE	200-DEMA	10-DEMA
BAJAJ-AUTO	104.6	429.27	22.16	2265.80	2279.29	2272.55	2214.84	2241.29

  

BAJAJ-AUTO

126.85

521.55

22.16

2495.18

2510.03

2502.60

2214.84

2241.29

BAJAJ-AUTO

147.32

659.8

22.16

2688.98

2704.98

2696.98

2214.84

2241.29