Ladies and gentlemen, good evening, and welcome to Q2 FY 2024 results conference call of Bajaj Auto Limited. My name is Rio, and I will be your coordinator. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the initial remarks from management. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Anand Newar, Head, Investor Relations from Bajaj Auto Limited. Thank you, and over to you, sir. Thanks, Rio. Good evening, everyone, and welcome to Bajaj Auto's Q2 FY 2024 earnings conference call. On today's call, we have with us Mr. Rakesh Sharma, Executive Director, and Mr. Dinesh Thapar, Chief Financial Officer. We will begin our call with an opening remark from Rakesh on the business and the operational performance for the quarter, and Dinesh will take you through the financial highlights. We will then open the forum for the Q&A. Over to you, sir. Thank you, Anand. Good evening, ladies and gentlemen, and welcome to our earnings call for quarter two. We deeply appreciate your presence here this evening. So let me begin with an overview of our performance in Q2. Yet again, we have delivered a record financial performance with an all-time high revenue, EBITDA and PAT, breaking our previous record that was set just last quarter. This performance is yet again a great reminder of Bajaj Auto's robust business model that reflects the resilience and vitality of a well-diversified business. Dinesh will take you through the financial performance, so let me focus on the business unit performance. Starting with exports business unit. The macroeconomic environment, combined with the new geopolitical issues, remain uncertain. However, the world, and in particular, the financial systems, seems to have adapted to this as the new normal, which is leading to some improvement in Forex availabilities for trade. However, currency-led inflation has continued to dampen the pace of recovery after the sharp fall in H1 of last year. Overall, our exports are still at about 66% or 2/3 of the peak, which we had recorded in financial year 2022. But sequentially, there is an 8%-10% quarter-on-quarter improvement in both retails and our shipments. And this has occurred across all regions. Africa is a double-digit improvement, powered by Nigeria on a quarter-on-quarter basis. Asia, MENA, which is Middle East and North Africa, and LATAM, are single-digit improvements. We expect the recovery to continue at this overall pace. The return to peak levels of performance will be a slow and steady process rather than a quick one. Coming to domestic motorcycles business unit, the industry recorded a growth of 5%-6% year-on-year in retails for the months of July and August, followed by a 20% growth in September, therefore, delivering a growth of 10% for quarter two on retail basis. In this, the 125 cc plus segment continued to grow faster than the 100 cc segment. In quarter two, the industry weight of the 125 cc- plus segment shifted to 51%. Our retails are up 22% on, in the quarter on the back of the 125 cc- plus performance, which grew at 36%, significantly outpacing rest of the industry. Our market share in the 125 cc- plus segment is now 30%, and the segment accounts for 65% of Bajaj Auto's volumes. In billing terms, you would have seen a decline, but I would like to remind you here of the skewed base of Q2 last year, where channel inventory was being refilled post-resolution of the semiconductor supply issue. And therefore, you would have seen a very sharp growth performance in quarter one, which is also to be ignored, because last year, quarter one was very small for Bajaj Auto. Festive period, though just based on last three days of retails, has got off to a promising start. Based on this and also the kind of consumer sentiment we saw during Ganesh Chaturthi, Onam in certain parts of the country, we expect the industry to grow at about 12%-15% over a like-to-like period last year. You know, the festive period is 33 days, and so a lot of shifts by 15 days, calendar days, every year. So when we compare the like-to-like 33 days of last year with this, we are hoping that it will be, you know, a double-digit growth. Bajaj Auto should outpace this performance comfortably, again, on the back of a superior performance in the 125 cc- plus segment. Our strategy continues to drive profitable growth in the 125 cc- plus segment based on product differentiation and sharp positioning. Towards this, the upgrades of Pulsar 160 and 200 NS, the new Pulsar N 160, have all combined to increase our market share. The recently launched Pulsar N 150 is positioned for a modern, sporty commuter and has been very well received. Pulsar has deeply strengthened its leadership in the 150-250 cc segment, with a commanding market share now of almost 40%. Almost six new launches and upgrades are expected in the next six months, which will further consolidate our position in the 125 cc- plus segment and drive market shares to a new high. Commercial vehicles, the hero business for Bajaj Auto this quarter, is really the three-wheeler business. It had a record-breaking quarter, with quarterly volumes touching a new high of 132,000 units, and sales in September itself crossing 50,000 units. This translates into a growth of 34% quarter-on-quarter and 81% year-on-year, consolidating a significant leadership position with 80% market share in September. The performance is driven by capturing, in a very disproportionately high manner, the conversion of diesel markets to CNG. Our shares in cargo and diesel segment have also increased. All the increase in market share has been achieved while improving EBITDA and pricing premium over competition. Electric three-wheelers were launched in Agra, and we've completed a quarter of our pilot over there, and they've been received extremely well, with Bajaj Auto e-three-wheelers capturing almost 70% market share in Agra within the quarter. We've commenced our Phase 2, calibrated expansion program, which will take us to 40 cities in the next six months. We have already entered, after Agra, we've already entered about 10, cities. The big push will happen thereafter in FY 2025. Our approach is to first attack markets where autos are not permitted, and this brings in new business to the company. It is important to state that at this point, the e-three-wheeler business is not margin diluted for us, and therefore, we are keen to drive its expansion while ensuring a very high standard of customer service. On Chetak, as mentioned before, supply chain work has increased our capacity and reduced costs, allowing us to open up the network, right-price the product and drive sales. We are now in 120 cities, with 140 exclusive sales and service stores, covering almost 75% of the high-speed EV market. Our market share has increased from 4% in FY 2023 to 11% in September in retail terms. We are pushing for reaching the 10,000 sales mark this quarter and then building on it next quarter. Within Q3, we will present two upgrades and follow this up with a further expansion of the range in Q1 of next year. Our network, alongside, will expand to about 180 cities by the time we exit the financial year. Our premium biking business, Triumph, as you know, it has received a tremendous response since its launch early last quarter. Deliveries of the Triumph Speed 400 commenced by end of July, and we have received an overwhelmingly positive customer as well as professional user feedback, pushing us to fast-track deliveries to over 8,000 units in quarter two, and we have conducted already, you know, tens of thousands of test rides. To support this momentum, we are building system capabilities on the front and the back end. Currently, we have a capacity of 5,000-7,000 units per month, which is being expanded further in coming quarters and should go up to about 10,000 units by the time we exit the financial year, per month. This will allow us to take the brand to over 100 cities by the end of FY 2024 from the current count of 20 cities, and all this through best-in-class exclusive stores. We've launched the Scrambler 400 X early last week at an attractive price of INR 2.6 lakh ex-showroom, with a promise of delivering an on-road, off-road finesse like its elder siblings, the Scrambler 900 and 1200. Very successful models worldwide. The early interest of this vehicle is encouraging. The professional feedback is also very inspiring, and we are eagerly awaiting for a similar customer customer adoption for the Scramblers as we had for Speed 400. Export of Triumph bikes will commence by end of this month or maybe just first two-three days of November. The product and prices have been unveiled in several international markets, and there is a palpable excitement about the arrival of the smaller Triumphs. This quarter, we have also launched the all-new Generation 3 Duke 125s and 250s in the KTM range. These Generation 3, Gen 3 KTM Dukes are a very good leap forward, combining KTM's ready-to-race DNA and drawing from their largest sibling, the KTM Super Dukes. A new Husqvarna range is also on the cards, and we expect this fresh portfolio to energize the sales performance. As we move forward into the rest of the financial year, our focus will remain unerringly on delivering outstanding outcomes in five business areas, which will define the company's overall performance. Number one, continue to drive growth in 125 cc segment, building the Pulsar franchise through new launches. Number two, ensure 80% market share in three-wheelers and steadily expand e-autos. Number three, ensure steady export recovery with a quarter-on-quarter improvement in sales in every market. Number four, expand the Chetak business to 10,000 units per month based on new launches and good supply chain support. Finally, number five, scale up the Triumph sales in India and, in due course, in overseas markets, too. With this, let me hand over the call to Dinesh to take you through the financial performance. Thank you. Thank you, Rakesh. Good evening, everyone on the call, and thank you for taking the time this evening to join us. Let me start by saying we are very pleased with our performance in the context in which it has been delivered. It's been a record quarter, coming on the back of what was a previous record quarter in the last, in quarter one itself. As usual, let me start before getting into the financial commentary, with a quick roundup of the operating context, which really has underlined our delivery of the results this quarter. On exports, you heard Rakesh talk about it. The environment remains very volatile, with continued macroeconomic challenges across our key markets. We're doing well to really be able to build back volumes, trying to make each quarter larger than the previous one. We know that we hit a peak volume of 210,000 units in FY 2022, when markets were buoyant with and flush with liquidity. That went down to 115,000 in quarter four. It's built back to 130 in quarter one and 140 in the current quarter. On domestic, domestic motorcycles, overall industry motorcycle growth has continued, with the first half being mid-single digit and Bajaj Auto clearly outpacing the market. And our continued trust on leading premiumization in the 125 cc upwards, which is all but well for mix as well, has seen us outstrip the market by a multiple. The market for commercial vehicles has remained buoyant over the last few months, which has also led to us registering a record performance. Industry, by and large, has revised to the pre-COVID levels, and you know, we've said this earlier, that Bajaj had already recovered to pre-COVID levels a few quarters back, and we continue to outstrip the market, and the industry. On commodities, by and large, I'd say that the basket was favorable. Commodity costs have softened, particularly on the metals complex. We seem to be fast approaching levels that we had seen in the back half of FY 2023. You will recall at the last call, I had mentioned that we've seen a slight uptick on steel and aluminum, but that has settled down towards the end of the quarter, and we've continued to see stable and soft commodity prices through this quarter as well, and therefore, some level of tailwind to our profitability. The currency situation has remained stable to slightly positive, with export realizations coming in at 82.6, as against 82.1 in quarter one and 79.8 for the same period last year. Now, with this operating context, you know, as a backdrop, I think we did a fine job of reporting our best ever performance, on all counts, on revenue, on EBITDA, on margin over a five-year horizon, and on PAT. Coming to revenue, our revenues are INR 10,777 crore, representing an all-time high, were up 6% year-on-year. However, I'd like to draw your reference, and Rakesh alluded to this in mention, that the base period, clearly, we are faced with a very stiff comparator. It was when we were filling back inventory and resolved the semiconductor issue. And therefore, I'd like you to focus a lot more on the normalized performance in the first half, which essentially points to a 60% revenue growth year-on-year. Now, just to make the point, before we get into the domestic business, which has registered another all-time high and a peak performance, just to bring that alive with numbers. You would recall that in quarter one, we reported motorcycle growth. I'm just using motorcycles as an example. We reported motorcycles growth of 60% upwards on billing volumes. And quarter two on motorcycle growth, we're down 23%. And that essentially represents the skew that we had, because it was coming off a depleted quarter one in the base and a filled back quarter in quarter two in the base, right? So therefore, when you normalize it, volumes for the first half are 7%, even though our billing, our retail growth for both quarter one and quarter two, and therefore, half, half one are closer to 20%. So we've sustained momentum in retail terms, which is really the health of the business, even though billing numbers and therefore reported revenues have been skewed between quarter one and quarter two. Our domestic business registered a new peak. You just heard that being mentioned on the back of six successive quarters now of double-digit growth, really led by the sustained competitive growth of the 125 cc upwards on domestic motorcycles... The momentum on the CV business has now hit a historic high. The last time, commercial vehicles hit a record was way back in 2018, when it had done 122,000 units in a quarter. This is now the new record, and a continuous scale up on Chetak. EBITDA came in at INR 2,133 crores, surpassing a very significant milestone of INR 2,000 crores in a single quarter, and this is the very first time that we have surpassed it, registering a growth of 21% year-on-year. Our margins closed at 19.8%, up 260 basis points year-on-year, driven by dynamic pricing cost management, which accounted for the most part, better foreign exchange realization and a richer product mix, which more than offset or covered for the drag arising from the investments that we are making in growing our electric scooters business. On a quarter-on-quarter basis, our margins improved 80 basis points. You recall we had reported 19% last quarter, and largely arising out of the seasonal mix that we had called out then on domestic motorcycles, given the festive season. So it was 19.0. And so the 80 basis points that we have improved in the current quarter, is really coming on the back of softer commodity costs and better product mix. You know, really driven by the higher sales of three-wheeler portfolio, which is also a part of the drag that we have on mix coming out of higher volumes into Nigeria. When you look at it from a price and cost perspective, I'd say pricing across the breadth of the business, after adjusting for the pluses and minuses, has been flattish. So really, margin improvement sequentially coming on the back of softer commodity costs, and an improved product mix, largely led by the buoyancy of our three-wheeler business. Finally, we closed the quarter with a record net profit of INR 1,836 crore, and a cash surplus of nearly INR 17,500 crore, having added almost INR 3,600 crore of free cash flow in the first half of this year. That represents a very significant 60% increase over the same time last year. And this cash pile of INR 17,500 crore is after having disbursed nearly INR 4,000 crore of deliveries. As you would make out, the balance sheet therefore remains very robust and healthy with this cash surplus, and allows us enough fuel to be able to invest competitively, for growth and investments as we look forward. Let me end by saying, looking forward, I think there are a range of priorities that Rakesh summed up with, and I'd like to quickly call out before we hand over to you for questions. Our priorities of course remain to sustain the momentum that we are seeing in this business, both on top line and bottom line, within the upcoming festive season, continue our market-leading growth for the M3, S1, 125 cc upwards, segment. Build back export volumes and really inch it up as we've seen it gradually, try to make each quarter bigger than the previous one, in trying to get back to the areas of the 200,000, which could still be some time away, but really inching up quarter by quarter. Step up Chetak market share, which has now doubled over this last year from 5% to an exit share of 11% at the end of September, through a range of product interventions, activation and network expansion. Retain the momentum on our three-wheeler business and roll out to many more cities the electric three-wheeler, which has received a very encouraging early response. Scale up Triumph and capacity is being built both at the back end and the front end to really cater to an expanded domestic network that will be covering almost 100 cities by the end of the financial year, and the start of the exports business that we hope to see in the next couple of months, essentially between December and January, as conversations with Triumph are underway. And lastly, to sustain, profit and margin delivery, through dynamic P&L management, and given the commodity cost situation as it stands, I expect it to be flattish in the quarter ahead. And so this remains a priority as we dynamically manage the business for growth, to sustain, our margin, as we look into the quarter ahead. With this, I'd like to hand the session back to Anand and then open it up for questions. Thank you for your time. Thank you, Dinesh. Rio, we can open the forum for the Q&A. Sure. Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask questions may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. To ask questions, please press star and one. The first question is from the line of Gunjan Prithyani from Bank of America. Please go ahead. Yeah, hi. Thanks, team, for taking my questions, and thanks for a really comprehensive, you know, update of across the businesses. Before I get to my question, I just wanted to check one quick thing. Were there any, you know, one-time costs that we need to, you know, keep in mind around Triumph launch in this quarter? Nothing of significance, Gunjan. There was, of course, a launch event which happened, but I wouldn't say in the overall scheme of things, so that was very significant. Okay, got it. Now, two questions from my side. Firstly, on this three-wheeler, clearly, you know, this business has been surprising positively. I just wanted to understand if you can share your outlook in terms of what's really driving the market expansion here. It was quite intriguing, you know, when you mentioned that the margins for e electric three-wheeler are actually not dilutive. So if you could just, you know, share thoughts on how we should think about this business over, you know, over the next one, two years, and, you know, this whole scale-up of electric three-wheeler is, you know, is it contribution margin positive? Is it, you know, is it EBITDA margin positive? If you can share some thoughts around that. So, the ICE three-wheeler business, its fundamental driver is the conversion. There are two things. One is, of course, in line with every other segment of the auto industry, there is a recovery post-COVID, and people are coming back on the streets, and there is traffic, and there is need for mobility and, you know, the earnings of the three-wheeler drivers have improved, which has unlocked the retail finance. 90% of the business is financed. So those drivers have started to kick in and drive the business. The second thing is that the country is very decisively converting or promoting the usage of CNG. And the CNG powered three-wheeler really deliver a much better, a much better economic compared to diesel powered. Now, traditionally, our market share in the diesel segment was much lower, but, on the back of, you know, products which are really best in class, we have enjoyed very high market share in CNG powered vehicles. And, so as soon as the network, the pipeline network penetrates territory, we see a migration from diesel to CNG in a very powerful manner. And, when that migration happens, the first choice is Bajaj Auto. So therefore, we are seeing a CNG passenger level, a market share of 90%-93%. Like, nobody's able to sell any CNG three- wheelers. And so much so that now the CNG distributors, like the public sector undertaking, they work very closely with us because, you know, this auto line is gives them a good 8%-10% of take of their CNG. So they're also very interested in making this happen. So the system is working well, and I think this should continue. There are still vast areas left where the network is rolling in. The numbers are not coming to my mind, but I think the government this year has got some idea of some 4,000 new pumps being put in. And the more they do that, so the drive will continue. So the ICE business is set. The e-auto business. Now, if you see over the years, what has happened is that because the autos were restricted in large parts of north and east, it has given rise to this semi-organized industry of what we call the e-ricks, which are both lead-acid and now, of course, lithium-ion powered. And, the need for mobility in intercity, intracity mobility has been very, very strong in the smaller towns of northern India and northern. I'm sure if you travel to Saharanpur, Lucknow, and these places, you would have seen how choked the system is with these small three-wheelers. And, they are now 40%-50% of three-wheeled mobility, you know? Now, when we enter with e-autos, they don't require permits. So there is a very strong possibility, even though e-autos are more expensive, there's a very strong possibility of converting the e-ricks, as they're known, to e-autos, provided they deliver, you know, a value performance. So entire north and east is our first target, and there also, we don't sell too much of autos, ICE autos, and we should be able to get the e-autos moving over there. I'm going to let Dinesh take on the margin point, but yeah, the pricing, the way we've done the pricing, we find that, you know, we are largely more or less agnostic to e-auto or e- or e-auto or ICE auto. Okay. Yeah. No, so Gunjan, to your point, we are driving for near parity margins between the e-auto and the ICE auto. It also helps, you know, one, of course, incremental growth opportunity, but in many ways then, it becomes diagnostic of the fuel type as we sell across markets. But to the point that you asked very specifically, yes, it is EBITDA margin positive, and a few reasons. To put the contribution of the battery cost and therefore the cell cost, the overall cost is relatively lower compared to that of a two-wheeler. We've not added significant cost or establishment cost for the new group cost. We're putting up a new EV three-wheeler factory in Waluj. That'll come up at the end of the year, but we're not really expanding fixed costs substantially for it to maintain the economics. Limited marketing and advertising spend, given the very strong equity that Bajaj has as it goes into a number of these markets. And the fourth factor really is that PLI adds on to it as well, because clearly domestic value addition in the case of three-wheelers is comfortably poised at well over 50%. So allow set up PLI to grow and take it to the market. Okay, got it. This is super useful. Just second question, Dinesh, specifically to you, this dividend policy change. Can you talk us a little bit as to what triggered this change? And I do see the scope of fund deployment has been expanded to quite a few new inclusions. So, you know, if you can just give the thought process around it. And, you know, earlier, again, buyback wasn't part of that shareholder return that you spoke about. Right. That also seems to be included. So if you can just share what triggered this and what, what, why the change now? Yeah. Thank you. First of all, thank you, Gunjan, for picking it up, because we were hoping it would come up in Q&A, and therefore, we would, we would answer it. But look at, at the board we discussed today, the, the amendments that we are making, I think taking cognizance of the fact that there are multiple routes these days available to really reward shareholders or pay out excess cash, right? And so what we've done is to really expand the remit of that to a concept called the overall payout to shareholders, which will be a function essentially of the dividends plus the buybacks, or any other such similar routes that might, might exist or come about in the future. But really expanding the remit of, of a variety of ways by which you can return cash to shareholders. And we, like the principles, the earlier dividend policy, now we had to set up slabs for it. So we think based on the PAT of the year and the surplus funds that are available on the balance sheet, there are various slabs that we propose, and we must fundamentally alter it. The first slab is at 50, which is similar to what, what it was in the past. The second slab was 70%. And we said for cash in excess of INR 15,000, earlier, we used to say, up to 90%. We just said at greater than 70%, because then it allows us, as the board, the degrees of freedom to decide how we need to pay it out to shareholders over a period of time through a mix of dividends and buybacks. We just expanded the remit to really call out that buybacks might be one more way of returning surplus cash to shareholders in the future, and remains the discretion of the board then to do it through a mix of dividends and buybacks. Okay, got it. Thank you so much. Thank you. Before we take the next question, we'd like to inform participants that in order to ensure that the management is able to address questions from all participants in the conference, please limit your questions to two per participant. The next question is from the line of Amyn Pirani from JP Morgan. Please go ahead. Yes. Hi, good evening, and, thanks for the opportunity. My first question was on exports. You mentioned that you are expecting a gradual recovery. Within exports, it seems that three-wheelers as a category have been impacted much more than two-wheelers, and I'm guessing it is because some specific markets, which were large contributors, are, you know, near zero right now. So if you can give some comments around how you see the three-wheeler export recovering, and are there any new markets or new opportunities which could offset, you know, some of these larger markets like Egypt, which, you know, have gone into some kind of a regulatory bans kind of situation? Yeah. So, you're right, the three-wheeler recovery is slow, but... And, you see, Egypt had hit us even before the downfall commenced in quarter two of last year. So, that is, you know, something which had already impacted us. In terms of the CV, whether there's any other market which is behaving very differently, no, I would not say that. It's just that, you know, because the three-wheeler is a more expensive product, it becomes that much more difficult for people to acquire it. It is following a very similar pattern as two-wheeler. So it's largely country driven and a few percentage points behind two-wheelers, but following the same trajectory as two-wheelers. In terms of making up the deficit of Egypt, which was a very, very large market for us, we have got about 11 markets, which I would not like to name, which are under active business development. I don't think any single market will replace Egypt, but in a combination, if the markets improve, we will start to see this mitigation happening in these 11 markets. You see, we have been through this cycle before. We used to export 20,000 units, five-seven years back, out of which 10,000 were to Sri Lanka, and then Sri Lanka banned it. But we went to 25,000 units, with 0 in Sri Lanka. On the basis of opening up Cambodia, Philippines, Ghana, Mexico, Colombia, Bolivia-... You know, I can name maybe a dozen countries, which collectively, combined to Myanmar, combined to overcome this 10,000 unit gap. So, that is how we sort of met the challenge of the ban in Sri Lanka. This is the same way we are approaching the Egypt issue. It's just that the, the macroeconomic conditions have, you know, made business development a little bit more difficult. But over a period of time, through these new markets, we should be able to overcome the Egyptian deficit. Okay, that's helpful. Just going back, you know, on the three-wheeler or the e-auto, where, like you rightly mentioned, you know, you've already gained a lot of market share in the cities that you have launched. As you expand this, how do you see the value proposition of a CNG and an EV? I guess it's clear that both of them are winning against diesel as a whole. But between the two, I mean, is there, I mean, CNG is still a better value proposition than the EV. How do you think, you know, you would like to position it as you expand going forward? No, no, as the e-auto is a better proposition than CNG. At this, in these conditions, which are, you know, if the FAME is not disturbed, then as things stand now, the, with this same subsidy, e-auto is a better proposition than CNG for the driver. The other thing is that in a lot of markets, the permits, when people buy CNG vehicles, they also have to buy a permit, and, and that itself is very expensive. So the acquisition cost of a, in some markets where it is restricted and new, I mean, permits are not freely available, in those markets, e-autos don't require any permits, so, it's much, much better. Okay. Okay, that's, that's quite helpful, sir. And, thank you for taking my questions, and all the best. Thank you. Thank you. Thank you. The next question is from the line of Kapil Singh from Nomura. Please go ahead. Hi, sir. Good evening, and congratulations on a strong set of results. My question is just to conclude on three-wheeler ICE business, do you expect the volumes to grow from these levels as we look ahead? Yes, we think that the volumes will continue to rise on the back of the penetration of the CNG network and the recovery in traffic condition. But again, it will be a steady progress. I don't expect them to be rocketing upwards because we are at a very, very high level, and now, to be frank, we have reached a very high level of market share. So the growth which we have seen in the last six months or so has been driven by the recovery of the market, penetration of the CNG network, and expansion of our market share from 60% - 80%. In CNG, it has gone to 90%. So now I think we will ride the market growth rather than the combination of market and share growth. So therefore, there will be growth, but it will be muted. It will be lesser than what we've been experiencing now. Thanks, sir. And second question is on electric two-wheelers. Just wanted to understand that when, as we look to expand the portfolio, which segment customer are we targeting? And, for example, what I'm trying to understand is, is the 100 cc motorcycle customer also looking at electric two-wheelers? Is it only the scooter customer who you think we will be addressing? And in that context, what kind of electric mix are you thinking about for scooters or for, you know, motorcycles, going ahead? We are targeting all those customers who are very economically driven and for whom the scooter format is acceptable. So you will find that people adopting the electric two-wheeler range from people who had previously owned a entry-level motorcycle to somebody who's buying it in addition to supplementing a car in the garage. We have got the full spectrum of users. And the real proposition which is really getting traction for electric two-wheelers is one based on economics. That simply as things stand now people save money depending on how much they ride every month. So anybody riding 50 km and above saves a substantial amount of money by shifting from ICE to electric. So just to conclude, I mean, do you think at some point, the ICE two-wheeler industry sort of stop growing? Do you see that on the horizon in next two, three years? I don't think so, because, you know, if you sort of step back and see overall the penetration of ICE has been low, still, some scope over there. The road building programs are always very, very good in terms of facilitating the sale of ICE, particularly for intercity commutes. And if you see, we have not yet recovered to the 18-19 peak as an industry. We are still at about 25%-30% down over that peak. And I think the ICE industry very much dependent on how the economic recovery reaches the pockets of the, you know, customers at the bottom of the pyramid. As the economic recovery is happening, consumer optimism is improving. We are seeing an improvement in ICE, and therefore, we don't see in the near term that e-two- wheelers are going to apply the brakes on ICE. They will continue to grow the penetration. Having said all this, we have to see the recent data. After the recent FAME reduction, you see the data, the last three months, high-speed EVs have been only 65,000 units per month. Festive may pump up, pump it up for some time, but they're only 65,000 because the acquisition cost is very high. It makes monthly sense, but the acquisition cost is still high. You know, most of the three- wheelers, the on-road prices are, you know, two- wheelers are INR 1.25 lakh-INR 1.3 lakh. And the customer who is really receptive to the, this is the economically sensitive customer. So it's the largely, that is the segment. So therefore, the penetration is sort of slowed down. Thank you very much, sir. Great answer, and wish you all the best. Thank you. Thank you. The next question is from the line of Chandramouli Muthiah from Goldman Sachs. Please go ahead. Hi, good evening, and thank you for taking my questions. I just have... My first question is just a clarification on the e-three- wheeler profitability commentary. So I think you did make a statement that it is not margin dilutive from Bajaj Auto, and also we, we sort of commented that it is on margin parity with the electric three-wheeler. So just trying to understand, is it, is it sort of, should we think about it as a positive margin product, or should we think about it as on par with on the corporate EBITDA margin in that 18%-20% range? I couldn't understand, where is the margin? Okay, thank you. The, the line was a bit fuzzy, so we missed the question. But, I think just to summarize, you're asking us whether the margin profile for the electric auto is at parity with the enterprise or with the, with the, CV businesses. If that's your question, I mentioned that the margin is at parity with our CV business after considering the impact and the benefit of the PLI. Got it. Got it. That's helpful. My second question is on the electric two-wheeler business. So you did mention a plan to get to 10,000+ units per month there, and there was some commentary on the number of products that you might launch in the remainder of this fiscal years and in next fiscal year. So if you could just clarify again, sort of what is the product pipeline, in terms of sort of number of launches you're planning in this fiscal years and the next fiscal year on the electric two-wheeler space? Sure. Chetak and Triumph. Okay. Yeah, so like I said, once this festival is over, we will be introducing new models in Chetak, and by the time we are sitting down at this time, let's say next year, we will have a much fuller range. We have set up exclusive showrooms with one. One of the reasons why we were doing that, when we were thinking about whether to go to exclusive Chetak showrooms or take the easier way out of putting them in Bajaj showrooms, like some other people have done, it was because we were sure that as this market grows, it is small right now, it's only 65,000 units, 70,000 units. It's small, but as it grows, it will need to be segmented, and these segments will need different products. We can see in the market also, some companies have got a range of products. You can't do justice to a range of products, which without having an exclusive showroom. So that's the reason that is always, always there in our minds. So starting from post festive, we will have introductions which will expand the range. So you can expect something starting from, let's say, November onwards, and then something by end of quarter four, and then further on in quarter one and quarter two, these products will be introduced. Got it. Thank you very much, and all the best. I cannot really, you know, talk about what specific products, et cetera, at this stage. Got it. Got it. Thank you so much for your response as well. Yeah, but I just suffice it to say that we are entering, we are now in a phase where we are going to expand the business volumetrically, expand the retail network substantially, and expand the range. So we are in that phase now, which you would have already seen with the rise in market share. Now, we are only hoping that, you know, FAME doesn't play a spoiler and doesn't retard the penetration rate, which has stagnated in the recent past. Got it. Thank you. The next question is from the line of Raghunandhan NL from Nuvama Research. Please go ahead. Thank you, sir, for the opportunity. Couple of questions to Dinesh, sir. Firstly, steel and crude derivatives have seen some increase recently. Do you expect some cost increase in commodity basket for Q3 versus Q2? Thank you for your question. You're right. You know, very recently there's been a slight uptick, but I think, when I look at the forecast out ahead for the, for this current quarter, which is essentially quarter three, I think given, the softening of some of the other commodity baskets, especially noble metals, which have kind of corrected quite significantly, I think on balance, I would expect a quarter which is quite flattish on commodity costs. Thank you. Good to hear that. Dinesh, sir, can you share some numbers on spares, exports, and financing ratio for the quarter? So exports was about $406 million for the quarter. You have our exchange rate between USD-INR, right? So 2.6. And the finance penetration. And also the spares number. Financing penetration for the quarter for our motorcycles business was 77% and 90% for our three-wheeler business. Not fundamentally different from what might have been in the previous quarter. Share of Bajaj Finance would be? Share of Bajaj Finance would be 43% of the total revenue. Got it. And, the spares number, sir, if you have it handy. Spares. Spares is close to anywhere, anywhere between INR 1,200-INR 1,250 crores for this quarter. Thank you so much. Lastly, can you share the Triumph pending order book? Sorry? Triumph. Quite frankly, we are not—I don't have that number readily. I don't have that number readily in my mind, but because we have stopped monitoring it. We were only monitoring the bookings when we launched the booking campaign. So now it has gone into business as usual, as it is with Chetak, or as it would be with any of the motorcycle or three-wheeler businesses, where we—it's not something which we are really looking at. You know, when before the deliveries had started, we were monitoring and we reached something like 18,000 at that point of time. We have delivered 8,000, but there has been fresh bookings also. So you can assume that it is still, you know, around the 10,000, if not upwards mark. Thank you so much, sir. Wishing you all the best. Thank you. Thank you. The next question is from the line of Mumuksh Mandlesha from Anand Rathi. Please go ahead. Thank you so much for the opportunity. Sir, with strong festive growth expected, led by uptick in consumer sentiments, how do you see the full year to the domestic industry growth versus the earlier guidance of 5%-8%? And can you indicate what could be driving the better consumer sentiment there? Well, you know, I would sort of wait till November end to see whether, you know, the sparkle of festive growth is like that full study or it is a more sustained improvement in the fortunes of the industry. Because one thing which we have noticed over the years, which you would have also picked up, is that the highs and lows have become sharper. I mean, earlier festive accounted, is that 33 days of festive accounted for 15%, 17% of the year. You know, 12 months means 8% on the average for each month, but festive would account for double, which would be 16, 17, now it has become 20%. So we cannot extrapolate this 20% and say that that's how the balance of the year would be. So therefore, I say that one would need to look at post-festive November to really take a call whether the fortunes of the industry have decisively shifted from the 8% range to the double-digit range or not. Right now, I would say if you are taking a full year's viewpoint, I would still say that, yeah, 5%-8% is where the trajectory is. Let's see how it goes in November, and then we'll be able to take a call. Got it, sir. And just on the EV potential for export markets, for both two-wheeler and three-wheeler, just want to understand, has those markets also developed any EV ecosystem there? The penetration of electric two-wheelers outside of Europe and rest of the world is very low, but they are on the horizon, and everyone is dealing with the issues of cost, price, margin, range anxiety, and battery life and things like that. The ecosystem, I must say, outside of Europe is not as well developed as it is in India. There are opportunities which are bubbling. Because of our very, very wide footprint all across the world, obviously, we are monitoring these, both for two-wheelers and three-wheelers, and appropriately, we will enter some of these markets. It's very much in our planning, and again, I don't want to sort of jump the gun and announce which markets we are entering, but very much in the planning. Thank you so much for this. Thank you. We'll be able to take one last question. We take the last question from the line of Binay Singh from Morgan Stanley. Please go ahead. Hi, team, thanks for the opportunity. Just going back to the electric three-wheeler comments that you guys made, quite interesting to note that the profitability is closer to the ICE version. Now, just to understand, do you think that will also be the case when you ramp up pan India, or is it just that you are in a small pocket, so the competitive intensity over there is lower? And secondly, linked to that, you know, when we talk about why the electric two-wheeler margins are a lot lower than the electric three-wheeler, Dinesh highlighted three things, right? PLI, battery costs being lower, and secondly, lower advertising and sales spend. So looking at these three, it's very likely that PLI will go in two-wheeler also. So how do you see the two-wheeler margins then trending over a period of time, as you know, like, scale builds up over there? So any comment on sustainability of this three-wheeler margin that we are talking about on a pan-India basis, and then any comment on trajectory of two-wheeler, how does that turn? So I think, there are a lot of things which need to be, which should be clarified to you. So please, listen carefully and take the notes, you know, because number one, who told you compare, competitive intensity is low in the markets we have launched? We are, in fact, the last mover because there's already, Piaggio and, M&M and a host of other companies. The all the players who are present all over India are also present in the places we launched. The reason why we delayed our launch is when we did our, testing and trials with consumers, we got strong feedback about certain expectations they had from Bajaj Auto, because they feel Bajaj is the leader. So we had to go back. You know, last year I was all constantly telling you that it has got postponed, it has got postponed, and it was this reason that we had to get the product sort of in the bull's-eye region, and only then launch it, because we didn't want to sort of... So people had a head start over us. So I don't think that the competitive intensity, which we will now encounter as we move into newer and newer cities, will be more or less. In fact, if we don't encounter e-ricks, then it might be less. So I would say the competitive intensity is the same. The one, very important point, which, Dinesh, highlighted as to the reason why the margins are, different, which I don't know whether you mentioned or not, but the key reason, the biggest reason is that, you know, the component of the cost of the battery in the vehicle, the comparison between two-wheeler and three-wheeler is different. So three-wheeler, it is much less. Secondly, the three-wheeler, only the battery has changed for us and with a little bit of, you know, some other stuff which is there. Which is, it is essentially the same three-wheeler. What we are saying to the customer, technology..., you know, it's essentially, the powertrain has changed and the three-wheeler has remained the same. The marketing and all the other costs are, smaller factor. The PLI, I think you're confusing PLI and FAME. The PLI is equally applicable to two-wheelers also and to three-wheelers also. Right. No, so I was just picking up from the comments that Dinesh made. But then to an extent, you know, this is a very encouraging commentary, right? Because then it means that- In this, I also want to say, when the space gets limited, your ability to adopt one chemistry or the other also gets limited. Now, when you have a larger spaced vehicle like three-wheelers, you have options of different types of chemistries and different types of... I mean, we don't have to pack them so tightly, and therefore, you don't, you have the better flexibility in making more value decisions on the battery. So it's not just about that the battery cost is constant and it is divided by the total vehicle cost. The battery cost itself can change because you have a greater degree of freedom in choosing a value, a better value battery. Then just to, you know, look at it in terms of growth, because then it's a, it's a good, it looks like a good growth vertical for us, that is, you know... Yes, it is. It is. would you say that between all the business segments, you know, just taking like a three-year CAGR view or so, fair to say that the three-wheeler business, ICE plus EV domestic, should at least be on track or in a similar run rate as the two-wheeler business? Because, you know, like, this is opening up a new vertical, right? The EV side opens up markets which were earlier restricted. Yeah. So it will be on a healthy track, but at the same time, I feel that the two-wheeler business for us, and particularly with the now tailwind supporting the top half of the industry more than the bottom half, and that is our, you know, that's a playground where we have strengths in, and the fact that we still have a lot of room to grow in terms of market share, in the, even in the 125 cc- plus segment. Now, the whole, the 250-500 cc segment is opening up for us, thanks to the Triumph collaboration with Triumph. I mean, where we were in a very, very marginal presence through Dominar 400 and little bit of KTM. This is a vast segment which is opening up, and the 125 cc- plus segment also offers us continued opportunities to increase market share. For that, we are well placed in terms of, you know, our DNAs, product innovation and leveraging R&D and all that. So I would say that the three-wheeler two-wheeler business also has got very significant upside opportunities for growth. What was, let's say, a year back, we couldn't imagine it or envision it, was the three-wheeler opportunity. That was looking like tanking. But thanks to the surge in CNG and thanks to the recovery, and now, of course, the ability to take the e-auto and cannibalize the e-rick, three-wheeler business also comes back very strongly as a growth vector for us. Just lastly, how many electric three-wheeler did we actually sell in the quarter? This last question. 600. 600. Great. Great. Thanks a lot, team. Thank you. Hey, you know, I don't know whether, you know, I, I'm guessing you're aware of it, but, you know, just for it to register with the rest of the audience. The PLI is about 13% once, you know, DVA norms are met, and we're clearly meeting them very comfortably because we already have an existing auto business, a three-wheeler business. So really, the benefits of localization are being extended to that business. So therefore, we're meeting the DVA norm quite comfortably. And also it helps with the, the proportion of the battery pack to the overall cost is much lower. So when you're meeting the DVA percentage, the, the upside that you get on PLI is 13%, which is quite significant, and that in many ways helps bridge the economics of the e-auto with the ICE auto. That you are getting the PLI incentive. So is it already something that you are getting or you've started to- There's a process that the government's mandated, which we are going through, which essentially involves, a certain process that has to be followed with the testing agency, registration, and eventual certification for PLI. So we've, we're going through the hoops on that one. But, you know, the fundamental condition on domestic value addition being at a 50% threshold, is comfortably met, for the year. In a way, in this quarter, there is no, obviously no PLI incentive? There's no PLI. Yeah, because we, we started, I think, because we were product ready and we clearly wanted to do a calibrated launch. So we've launched without the benefits of the PLI coming into financials at the moment. But we're going through the process of clearly its certification, so should have it at some point. Great. Great. Thanks for that. Thanks for that, Dinesh. Thank you very much. We'll take that as the last question. I would now like to hand the conference back to Mr. Anand Newar for closing comments. Thank you, everyone, for joining this call. I can see a few participants still waiting for us to ask questions, and I'm happy to take those questions after 8 P.M. today. Thank you, and thank you for a great festive. All the best. All the best for a great festive. Yeah. Thank you. Thank you. Thank you, everyone, for your time. Thank you very much. On behalf of Bajaj Auto Limited, that concludes this conference. Thank you for joining us, ladies and gentlemen. You may now disconnect your lines.