Bajaj Auto has decided to reduce the price of its entry-level Freedom 125 motorcycle by Rs 5,000 and the mid-variant by Rs 10,000.

Despite delivering more than 80,000 units to dealers since its launch, the actual sales recorded in the VAHAN database show only 34,000 units sold. This indicates that there is a significant surplus of inventory among dealers.

UBS has given a 'Sell' rating to the stock, pointing out the difference between dealer inventory and actual sales figures. The CNG motorcycle market is still in its early stages, and the initial enthusiasm has not translated into sustained sales. The management plans to increase the production of the Freedom 125 to 30,000 units per month in the third quarter and expects to further increase it to 40,000 units per month in the fourth quarter. More details about the reasons for the price cuts are expected to be released soon.