Maruti vs Bajajfinsv Q2 FY25

Maruti Suzuki reported Q2 FY25 net sales of INR 35,589 crore, nearly flat YoY, while PAT fell 17.4% to INR 3,069 crore due to a one-time tax provision. Domestic wholesale volumes declined 3.9% YoY, but exports grew 12.1%. Festive retail sales surged 14% YoY, driven by rural demand and higher discounts averaging INR 29,300 per car. CNG mix reached 33% of sales. Management expects full-year retail growth of 3-4% and stable discounts. The upcoming EV launch in January 2025 and Kharkhoda plant commissioning by Q4 are key catalysts. Risk: small car segment remains weak due to affordability challenges, with no clear recovery timeline.

Guidance read

Full-year retail sales growth of 3-4%: Management expects retail sales to grow 3-4% for FY25, with April-October already at 3.9%. Kharkhoda plant commissioning by Q4 FY25: The new 300,000-unit capacity plant in Kharkhoda is on track to be commissioned by end of this financial year. EV launch in January 2025 with high range: The first EV (e-SUV) will be launched at Bharat Mobility Global Expo, featuring a ~60 kWh battery and high range. One EV launch per year on average till end of decade: Management plans to launch 5-6 EVs by the end of the decade, averaging one per year.

Risk read

Key risks include Small car segment weakness — Affordability challenges persist in the small car segment, with no clear recovery timeline despite limited edition launches.; Discount pressure on margins — Higher discounts (INR 29,300/car) are compressing margins; sustainability depends on demand recovery.; Yen volatility and hedging effectiveness — CFO noted yen uncertainty due to macro factors (US elections), though hedging is being stepped up to reduce volatility.; Model portfolio complexity — Expanding to 28 models from 18 raises complexity in dealership footprint and operations, acknowledged by management as a key challenge..

Promise ledger

Of 2 tracked promises, management 0 met, 0 close, 2 missed.

Bajaj Finserv reported consolidated revenue growth of 30% YoY to ₹33,703 crore, with PAT up 8% YoY. The general insurance business (BAGIC) saw core premium growth of 11% (3x market), though headline GWP fell 20% due to a government health shift to Q3. Combined ratio worsened to 101.4% from 95.3% due to higher natural catastrophe claims. Life insurance (BALIC) grew individual retail new business by 34% YoY, but VNB margins declined 3.8pp to 9.2% due to a mix shift toward ULIPs. Bajaj Finance AUM grew 29% with strong asset quality (GNPA 1.06%). Management highlighted disciplined underwriting and risk management, but flagged near-term headwinds from regulatory changes (surrender value norms) and competitive pressure in credit life. Key risk: further margin compression in life insurance if ULIP dominance persists.

Guidance read

BALIC VNB margin improvement in H2: Management expects VNB margins to improve in H2 as product mix rebalances away from ULIPs and commission deferrals take effect. Bajaj Finserv Direct breakeven in 1-2 quarters: The marketplace business expects to break even on a cash basis within the next couple of quarters. Capital deployment of ₹500-600 crore in health & AMC by Mar'26: BFL plans to invest ₹500-600 crore in health tech and asset management over the next 18 months. BAGIC core growth to remain above market: Management expects core premium growth to continue outpacing the industry, driven by disciplined underwriting.

Risk read

Key risks include Allianz exit from JV creates strategic uncertainty — Allianz has informed Bajaj of its decision to exit the joint venture; management provided no further details, creating uncertainty around future ownership and operations.; VNB margin compression from ULIP mix and regulatory changes — VNB margins fell 3.8pp YoY to 9.2% due to higher ULIP sales; new surrender value norms may further pressure margins.; Motor TP price hike delay hurting growth — No TP price hike for three years has led to underwriting losses; management has reduced exposure, capping motor growth.; Retail health profitability under pressure — Medical inflation and hospital fraud are squeezing margins; management is cautious on growth in this segment..

Promise ledger

Of 2 tracked promises, management 0 met, 0 close, 2 missed.