CLSA cuts Bajaj Auto to "sell" on outlook

Reuters
A worker cleans a Bajaj motorcycle at a Bajaj showroom in Kolkata October 16, 2013. REUTERS/Rupak De Chowdhuri
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A worker cleans a Bajaj motorcycle at a Bajaj showroom in Kolkata October 16, 2013. REUTERS/Rupak De Chowdhuri

Reuters Market Eye - CLSA has downgraded Bajaj Auto (NSI:BAJAJ-AUTO) to "sell" from "underperform" despite better-than-expected July-September results, saying profit margins should weaken in the second half of the fiscal year as product-mix worsens and input cost pressures rise.

CLSA says Bajaj's valuations are also "expensive" at 16 times fiscal 2015 price-to-earnings.

Bajaj, India's second-largest motorcycle maker by sales, reported on Wednesday a second-quarter profit that beat analyst estimates as a weaker rupee gave export earnings a boost.

(Reporting by Indulal P)

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