Index Membership and Market Capitalisation Impact
Bajaj Auto Ltd. holds a commanding position in the Nifty 50, India’s premier stock market index, which represents the top 50 companies by market capitalisation and liquidity. With a market cap of ₹2,69,747.56 crores, Bajaj Auto is categorised as a Large Cap stock, a status that not only enhances its visibility among institutional investors but also ensures its inclusion in numerous index-tracking funds and ETFs. This membership amplifies the stock’s liquidity and trading volumes, making it a critical component for portfolio managers seeking exposure to the automobile sector.
The company’s Price-to-Earnings (P/E) ratio stands at 30.12, notably below the industry average of 34.23, signalling relatively attractive valuation metrics compared to its peers. This valuation differential has likely contributed to the recent upgrade from a Hold to a Buy rating by MarketsMOJO on 3 February 2026, reflecting improved earnings prospects and market positioning.
Recent Price Performance and Technical Strength
Bajaj Auto’s share price has demonstrated resilience and upward momentum, trading just 2.7% below its 52-week high of ₹9,900. The stock has recorded a consecutive four-day gain, delivering a cumulative return of 1.62% during this period. On 5 February 2026, the stock closed with a modest gain of 0.17%, outperforming the Sensex, which declined by 0.15% on the same day.
Technically, Bajaj Auto is trading above all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a strong bullish trend. This technical strength supports the positive fundamental outlook and suggests sustained investor interest in the stock.
Sectoral Context and Comparative Performance
The automobile sector, particularly the two- and three-wheeler segment, has witnessed mixed results in the recent earnings season. Out of 121 stocks that declared results, 42 reported positive outcomes, 68 remained flat, and 11 posted negative results. Bajaj Auto’s performance stands out favourably within this context, reflecting operational efficiency and market share gains.
Over the past year, Bajaj Auto has delivered an 8.04% return, outperforming the Sensex’s 6.93% gain. The stock’s performance over longer horizons is even more impressive, with three-year returns of 150.53% compared to the Sensex’s 37.56%, and a ten-year return of 308.76% versus the Sensex’s 239.98%. These figures highlight the company’s consistent ability to generate shareholder value over time.
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Institutional Holding Trends and Market Sentiment
Institutional investors have shown a marked increase in their holdings of Bajaj Auto, reflecting confidence in the company’s growth trajectory and sectoral outlook. The stock’s upgrade to a Mojo Score of 74.0 and a Mojo Grade of Buy from Hold on 3 February 2026 further validates this positive sentiment. The Market Cap Grade remains at 1, indicating the company’s top-tier market capitalisation status.
Such institutional interest is critical for sustaining liquidity and price stability, especially for a Nifty 50 constituent. It also influences the stock’s inclusion in thematic lists and model portfolios curated by research firms like MarketsMOJO, which can drive additional inflows from retail and professional investors alike.
Valuation and Earnings Outlook
Bajaj Auto’s current valuation metrics suggest a balanced risk-reward profile. Trading at a P/E of 30.12, the stock is attractively priced relative to the broader automobile industry, which commands a higher average P/E of 34.23. This discount may be attributed to cautious market expectations amid global supply chain challenges and evolving regulatory frameworks impacting the automobile sector.
However, Bajaj Auto’s consistent earnings growth, operational efficiencies, and product innovation pipeline position it well to capitalise on the recovery in two- and three-wheeler demand. The company’s ability to maintain margins and expand market share will be key drivers for future upgrades and positive revisions in analyst forecasts.
Benchmark Status and Broader Market Influence
As a Nifty 50 constituent, Bajaj Auto’s performance carries broader implications for the index and sectoral benchmarks. Its steady gains and relative outperformance contribute positively to the automobile sector’s representation within the index, which in turn influences sectoral fund flows and investor sentiment.
The stock’s resilience amid volatile market conditions enhances its appeal as a defensive yet growth-oriented large cap. This dual characteristic makes it a preferred choice for diversified portfolios seeking exposure to India’s expanding mobility market.
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Outlook and Investor Considerations
Looking ahead, Bajaj Auto Ltd. is well-positioned to benefit from the gradual recovery in domestic and international demand for two- and three-wheelers. The company’s focus on innovation, cost optimisation, and expanding its electric vehicle portfolio aligns with evolving consumer preferences and regulatory mandates.
Investors should monitor key indicators such as quarterly earnings growth, margin trends, and institutional holding patterns to gauge the sustainability of the current momentum. Given its upgraded Mojo Grade and strong technical positioning, Bajaj Auto remains a compelling option for investors seeking exposure to a blue-chip automobile stock with a proven track record.
However, risks related to raw material price volatility, competitive pressures, and macroeconomic uncertainties should be factored into investment decisions.
Conclusion
Bajaj Auto Ltd.’s reinforced status as a Nifty 50 constituent, combined with its recent upgrade to a Buy rating and robust price performance, underscores its importance within the Indian equity landscape. The company’s attractive valuation, strong institutional backing, and sectoral leadership position it favourably for continued growth and market outperformance. As the automobile sector navigates a complex environment, Bajaj Auto’s resilience and strategic initiatives make it a key stock to watch for investors aiming to capitalise on India’s mobility transformation.
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