The company's net sales marginally declined to Rs 800.3 crore (including excise duty and income from operations) from Rs 810.9 crore. Gross profit (after interest but before depreciation and taxation) for the first quarter was lower at Rs 193.6 crore compared with Rs 202.84 crore in the same period last year.

First quarter production of two and three-wheelers has increased to 3,32,974 compared with 3,16,664 for the corresponding period in the previous year, the company said in a release.

Expenditure was higher at Rs 681.9 crore as against Rs 677.2 crore while interest was down to Rs 0.51 crore from Rs 1.05 crore. Depreciation was Rs 34.5 crore compared with Rs 31.4crore and Rs 48 crore has been provided for tax against Rs 51 crore in the last year. Company chairman Rahul Bajaj told shareholders at the annual general meeting on Saturday that trial production of the 100 cc 4-stroke automatic Saffire started on July 17 at the company's new Plant at Chakan. Commercial production and launch of Saffire is scheduled for October 1999. This product would contribute a total of 15,000 units by March 2000, the release said.

The company is introducing six new motor cycles next year - three each in the 100 cc, 125cc, and 125cc-250 cc range. The company has for the first time entrusted its collaborator Kawasaki with the responsibility of quality assurance in order to match international standards, the release said.In view of this, Bajaj Auto is expanding its motorcycle capacity at Aurangabad to 0.5 million units. By December 1998, the company expects all its products to comply with the April 2000 exhaust emissions, said the release.

Bajaj Auto has scheduled the launch of its 100cc 4-stroke automatic Saffire in October 1999 and lined up six new motorcycles for next year, three each in the 100-125 cc and 125-250 cc range.

The company expects to change over its three-wheeler production from two-stroke to four-stroke and towards this end the four-stroke front engine and rear engine three-wheelers would be introduced in September 1999 and November 1999 respectively. It is also engaged in the development of an ultra low emission 4-stroke 3-wheeler fuelled by compressed natural gas (CNG).