Chairman's letter

Dear Shareholders,

It gives me immense pleasure to write to you and share the highlights of what has been yet another landmark year for your Company and which comes at a time when we celebrate a truly historic centennial milestone — 100 years of the Bajaj Group.

As I reflect on this moment, I do so with a deep sense of pride, gratitude and responsibility. What began a century ago as a journey rooted in enterprise, trust and nation-building has today evolved into one of India’s most respected business groups. Bajaj Auto, as the flagship Company that started it all, continues to carry forward that legacy with purpose and conviction.

FY2026 has been a stellar year for your Company in more ways than one, with record results on all counts across volumes, revenue, profits and cash generation.

In a year marked by heightened geopolitical uncertainty, commodity inflation, supply chain disruptions and a rapidly shifting global environment, your Company delivered its best-ever financial and operating performance. What is particularly pleasing is the fact that this is the fourth successive year when the business has registered new highs, surpassing its past – reinforcing the resilience of our business model, the strength of our brands, the agility of our teams and our ability to adapt and grow even when external conditions remain challenging.

Let me highlight some of the key financial achievements of the year:

1.	Your Company scaled new heights during the year, delivering its highest-ever annual volumes at over 5 million units, overtaking its previous peak set several years ago.
2.	Standalone revenue came in at nearly ₹ 59,000 crore, the highest ever in the history of your Company, growing strongly at 17% over the previous year and powered by record performances across domestic and export businesses in both vehicles and spares. Consolidated revenue stood at nearly ₹ 63,000 crore, up a solid 23% year on year.
3.	EBITDA crossed ₹ 12,000 crore for the first time, while EBITDA margins remained robust at 20.5%, reflecting the disciplined and dynamic P&L management through the year, where every lever of judicious pricing, cost savings/efficiencies, richer mix and operating leverage was brought into action to sustain the industry-leading margin performance alongside making competitive investments.
4.	Standalone Profit after Tax reached a new peak at ₹ 9,825 crore, registering healthy double-digit growth and underscoring the quality and sustainability of earnings. Consolidated Profit after Tax stood at ₹ 10,744 crore, up 47% over previous year.
5.	Free Cash Flow generation remained exceptionally strong at over ₹ 8,000 crore, reflecting the robust cash conversion of your Company that enables it to continue investing behind future growth opportunities while maintaining a very healthy Balance Sheet with surplus cash of over ₹ 18,000 crore.
6.	During the year, your Company invested meaningfully across strategic priorities — notably on growing its presence in electric mobility, scaling up its financing business through Bajaj Auto Credit, sharpening its R&D capabilities through Bajaj Auto Technology, acquiring and assuming control over the KTM group, while widening its portfolio/footprint to leverage both domestic and international growth opportunities.
7.	In recognition of the Bajaj Group’s centenary year and Bajaj Auto’s position as the flagship Company, the Board approved a payout of 100% of the Profit after Tax for the year to shareholders, through a combination of dividend and share buyback, amounting to nearly ₹ 10,000 crore. This reflects our continued commitment to rewarding our shareholders from time to time commensurate with the growth and performance of the Company.

What makes this achievement very satisfying is that it was broad-based across every dimension of the business — domestic and exports, two-wheelers and three-wheelers, ICE and electric — reflecting the versatility of the Bajaj Auto business.

While the domestic business remained resilient, exports gathered strong momentum during the year and emerged as a major growth driver. This ability of one engine to compensate when another slows is a defining strength of your Company and an important reason behind the consistency of our performance over time.

Another defining feature of FY2026 was the rapid scale-up and strengthening of our electric mobility business. From not having a business on this front up to a few years ago to now emerging decisively as a foremost player that has market leadership positions and is profitable, bears testimony to exceptional agility, sharp execution capability and technological prowess of Bajaj Auto. With this, your Company retains its position as India’s largest electric 2W+3W player on a combined basis, a distinction it secured in the previous year.

Across our businesses, there is much to cheer about:

•	Our Domestic business delivered another year of record revenue, led by strong performances across premium motorcycles, commercial vehicles and electric mobility. We saw momentum step up and a particularly solid show in the second half of the year, buoyed by the rationalization of GST rates and sharp festive season execution.
	•	Within motorcycles, the strategically important 125cc+ segment continued to remain the key growth driver for the industry. We saw encouraging momentum in the sports motorcycle category led by the refreshed Pulsar portfolio, with new variants and upgrades receiving strong customer acceptance across markets. Pulsar, having scaled a new pinnacle yet again, continues to remain at the forefront as one of India’s most admired and trusted motorcycle brands.
	•	The premium motorcycle business under KTM and Triumph delivered its best ever performance during the year. Supported by portfolio expansion, network growth and impactful activation, the brands together set new milestones while strengthening our position at the top end of the motorcycle market.
	•	Chetak volumes crossed new highs during the year, supported by an expanded portfolio, wider availability and increasing customer trust in the brand, that has come to be recognized as one of India’s leading and trusted electric scooters. What I find truly heartening in this record performance is how the business staged a strong recovery in the second half of the year after being setback by the rare earth disruption earlier on, as swift engineering interventions and agility in the backend enabled improved availability of supplies.
	•	In Commercial Vehicles, your Company crossed the historic milestone of over 5 lakh units for the full year for the first time. The ICE franchise remains strong while the electric three-wheeler business scaled rapidly to exit the year with segment leadership. Today, our electric three-wheeler business has the widest portfolio and service footprint in the country, replicating the trust, reliability and quality that the Bajaj three-wheelers have come to be known for over the years. Your Company also made its foray into the e-Rickshaw category with the launch of ‘Riki’ during the year and is enthused by the large and attractive addressable market opportunity that lies ahead.
•	Exports delivered a strong comeback, reaching new highs on revenue and emerging as one of the biggest highlights of the year.
	•	Volumes crossed the important milestone of over 2 lakh units per month during the year after a prolonged gap, underlining the rebound in overseas markets and our strong competitive performance.
	•	Latin America sustained its remarkable momentum and delivered yet another record year, with our brands continuing to enjoy deep trust and preference among customers.
	•	Several Asian markets including Sri Lanka, Nepal and the Philippines recorded strong growth, while the recovery in Nigeria showed encouraging signs of stability.
	•	Exports of KTM motorcycles from India also revived during the year after a period of disruption that was caused by the restructuring proceedings in Austria.
	•	Brazil scaled up significantly during the year supported by augmented manufacturing capacity, successful product introductions and a growing network presence. It is particularly gratifying to see the encouraging acceptance of our products in such a competitive market despite being a relatively late entrant.
•	Our spares business delivered another year of record revenue and profitability, driven by sharper execution, improved service levels and strong channel partnerships.

Looking at our key subsidiaries, Bajaj Auto Credit Limited has made very impressive progress, having scaled rapidly and emerged as a key strategic enabler for the parent Company business. The financing Company remained steadfast in meaningfully expanding its customer franchise, delivering compelling propositions for its customers and building future ready capabilities with a digital first mindset while delivering strong returns and maintaining healthy asset quality. Assets Under Management grew ~2X to ₹ 18,835 crore as of 31 March 2026, Total Income stood at ₹ 3,248 crore, up >3X and Profit After Tax at ₹ 665 crore surged >11X, all over previous year. In its second year of effective operations, the business has delivered an industry-leading return on equity of 23% and enjoys the highest level of creditworthiness with AAA/Stable long-term debt ratings, and A1+ for its short-term debt programs.

On KTM, following the intense self-administration/restructuring process that the Company in Austria underwent earlier in the year, your Company stepped in to acquire a controlling stake and take charge of its revival. Since acquiring control in November 2025, we have worked closely with the Austrian team on capital backing, strengthening governance, reconstituting the Board, and putting in place a renewed Executive Leadership team with a clear mandate for owning/executing a roadmap that envisages a broad range of strategic actions to reboot and turnaround the business. Together, these actions are helping restore confidence among key stakeholders and laying the foundation for the Company's long-term recovery. While the turnaround remains work in progress, it is well underway, and we remain confident in the enduring strength of the KTM brand, its global customer franchise and its ability to return, over time, to the level of performance for which it has long been known.

On the Operations front, our plants continued to be guided by the principles and philosophy of TPM to achieve excellence, enhanced productivity, world-class quality, all at optimised cost. In FY2026, the Pantnagar plant was honoured with the prestigious 'Advanced Special Award for TPM Achievement' by the Japan Institute of Plant Maintenance (JIPM), and your Company received the 'TPM Excellence Award — TPM Excellent Case Study Commendation' from JIPM for the second consecutive year. Notably, Chakan-II, the youngest plant of the BAL family, successfully conducted its TPM Kick-Off ceremony during the year, taking its first step towards excellence.

Equally encouraging has been the progress made on the People front, where several initiatives are helping shape a stronger and more responsive organisation. I had mentioned Project Velocity in my previous letter to you. Over the last year, Project Velocity implementation has shown visible results in organisation-wide alignment of our objectives, enhanced cross-functional collaboration, and greater execution agility. Feedback from our engagement survey, corroborates this progress as scores related to alignment of objectives, access to leadership, timely collaboration and speed of execution have all increased, and with attributes of pride and advocacy at leading levels.

We have made concerted efforts over the years towards attracting a diverse talent pool. I am happy to share with you that currently close to 17% of our talent is women, who excel across domains – Manufacturing, R&D, Business Units and Sales, across levels. Your Company remains strongly committed to staying the course on building diversity and inclusion across the organisation.

As I reflect at the year gone by, one aspect that stands out for me is the balance your Company has maintained between performance today and preparation for tomorrow. We are not only growing our existing businesses competitively and profitably but also decisively investing behind laying the foundations for future growth and future readying the organisation.

Beyond our organisational priorities, we continue to uphold the Bajaj Group's long-standing commitment to societal development and nation-building through focused CSR interventions. As you know, Bajaj Beyond is the Bajaj Group's identity for skilling and social impact. Bajaj Auto Foundation, the CSR arm of Bajaj Auto, brings together skilling initiatives that span the education continuum—from schools, ITIs and polytechnics to engineering institutions—while maintaining a strong focus on increasing women's participation in technical fields.

It is immensely gratifying to see how this is shaping and scaling up. We have impacted over 3,000 engineering students by setting up state-of-the-art laboratories in partnership with leading institutions through the Bajaj Engineering Skills Training (BEST) initiative. Our commitment to nurturing women talent in Engineering is accelerated through the Rupa Rahul Bajaj Scholarship for Women in Engineering (RRBSWE), a ₹ 400 crore commitment that we have made over a decade. In the inaugural cohort, 506 women scholars received scholarships of up to ₹ 8 lakh, along with holistic development support. Our online learning programme, Bajaj Manufacturing Systems (BMS), has reached over 1.5 lakh ITI students. Building on this foundation, we also have a future-ready service technician programme that is generating employment opportunities for school and college dropouts, with nearly 30% women participation.

As we look ahead to FY2027, the external environment remains volatile, uncertain and complex.

Geopolitical developments, commodity inflation, supply chain disruptions and shifts in global trade dynamics are creating challenges in the operating environment, that are particularly pronounced as we start the new financial year. At the same time, the opportunities before us across markets and segments remain very significant and offer substantial headroom for growth.

India continues to be one of the world’s fastest growing major economies, with almost unparalleled long-term potential across both domestic consumption and electric mobility.

The uptick/rebound across overseas markets augurs well for your Company that is a foremost exporter from the country and a shining example of a Company that not just Makes in India for India but also Makes in India for 100+ countries the world over.

Accordingly, our priorities for the year ahead remain clear:

1.	Strengthening competitiveness in the strategically important 125cc+ domestic motorcycle segment through brand/product interventions and sharper in-market execution
2.	Accelerating momentum on KTM and Triumph brands, given the step change in their growth trajectories
3.	Turbo charging Chetak while driving its strong product proposition, market leadership and improved profitability
4.	Sustaining our unparalleled competitive position on commercial vehicles whilst decisively expanding segment leadership in electric three-wheelers and scaling up our recent foray into e-rickshaws
5.	Stepping up exports even further given the recovery across key international markets, whilst navigating the challenges/disruptions in global logistics
6.	Derisking supply constraints through capacity expansion (particularly for the electric portfolio and premium bikes) along with development of alternate materials/sources
7.	Continuing to invest sufficiently behind differentiated product innovation, impactful brand activation and superior customer experience
8.	Scaling up strategic growth enablers including Bajaj Auto Credit (vehicle financing) and Bajaj Auto Technology (R&D)
9.	Staying the course on the strategic actions to drive the turnaround of KTM and its return to sustainable financial performance
10.	Maintaining the focus on dynamic P&L and performance management to drive consistent, competitive and profitable growth against the backdrop of emerging challenges in the operating environment

As we celebrate 100 years of the Bajaj Group, this moment is also an opportunity to acknowledge the values that have guided us through generations — integrity, trust, courage, entrepreneurship and commitment to nation-building.

India itself has transformed dramatically over this century. To have participated in that journey in some measure — by creating high quality products, generating employment, serving customers across the world and contributing to the country’s industrial and societal progress — is both a privilege and a responsibility that we deeply value.

On behalf of all our shareholders, I extend my appreciation to our Managing Director and CEO, Rajiv Bajaj, for his leadership, to the management team, and to every member of the Bajaj Auto family across plants, offices, and geographies whose commitment and efforts power the organization every single day. I congratulate all of them for delivering a record performance yet again.

I also wish to acknowledge the integral contribution of our partners, our vendors, distributors, dealers, service providers and many more in the wider ecosystem who stand shoulder to shoulder with us in serving millions of customers across India and the world. I thank all of them and would like them to know we deeply appreciate these relationships.

And finally, to you, our shareholders — thank you for your unwavering trust and encouragement through the years. It means a lot.

As we step into the next century of the Bajaj journey, we do so with confidence, humility and a deep sense of responsibility to continue creating enduring value for all our stakeholders.

Yours sincerely,

Niraj Bajaj

Chairman