Latest news with #AshokLeylandLtd
Mint
26-05-2025
- Automotive
- Mint
Ashok Leyland to face speed-breakers of rising commodity price, muted volume
Ashok Leyland Ltd did well in the March quarter (Q4FY25), but the moot question is whether it has reached its peak financial performance from a near-term perspective. There are twin challenges. One is on the sales front: April volume data (including exports) was disappointing, dropping 6% year-on-year—not an ideal start to FY26. The other is the cost increase, mainly due to the safeguard duty imposed on imports of steel, a key raw material. Since the safeguard duty has been imposed for 200 days starting from April, the impact of higher steel prices could last for about two quarters. In Q4, standalone sales rose 5.7% year-on-year to ₹11,857 crore, led by volume growth of 5%. Average selling price rose marginally, with some part of the increase coming from sales mix tilting slightly more in favour of medium and heavy commercial vehicles (MHCV) from light commercial vehicles (LCV). MHCV sales increased by 7%, while LCV sales were almost flat. Gross margin per vehicle grew 5% to ₹5.84 lakh as material cost per vehicle fell by ₹18,000. Also read: With over ₹4,000 crore in cash, Ashok Leyland has eyes on acquisitions, new markets The material cost is likely to move up in tandem with higher steel prices. In the earnings call, the management highlighted that rubber prices have softened. But would the benefit from rubber price be enough to offset higher steel price? This is unlikely as the share of rubber in total raw material cost is much lower than steel. Ebitda margin expanded by 90 basis points year-on-year to 15%, another high at least in the past eight quarters. Though Ebitda growth was 12%, net profit growth was much higher at 30% as the benefit of operating leverage played out with depreciation cost remaining steady. Also read: Ashok Leyland bonus share issue: Board meet slated on May 23; stock rises 3% Ashok Leyland has become a net cash company. Cash balance at FY25-end stood at ₹4,000 crore versus a net debt of ₹88 crore a year earlier, even after incurring a capital expenditure (capex) of nearly ₹950 crore. The big favourable swing can be explained by a reduction in debtors and inventories on the asset side and higher trade payable on the liability side, with both sides contributing around ₹1,000 crore each. This is a remarkable improvement in working capital management. Capex in FY26 is likely to be at the FY25 level. As far as subsidiaries are concerned, Switch India became Ebitda positive in FY25 in-line with the earlier guidance. It achieved a double-digit Ebitda margin in Q4. The next target is to make it profitable at the net profit level so that it is able to meet its own funding requirement of capex ahead, which would avoid the drain on standalone Ashok Leyland's cash. Switch UK is on track to cut its production cost by shifting the manufacturing operations out of the UK. Switch UK is incurring a monthly loss of about GBP 2-3 million, which should reduce with the restructuring of the company's operations. Though there was an injection of capital by Ashok in its lending subsidiary Hinduja Leyland Finance (HLF) in the past, it was to take care of capital adequacy requirements by the Reserve Bank of India in view of its rapid growth. Going forward, it may not have any big capital requirement from Ashok. The work on listing HLF is in the final stages as most of the regulatory requirements have been complied with. Also read: Likely UK plant closure a positive for Ashok Leyland. High promoter pledge isn't Ashok Leyland stock trades at a price-to-earnings and EV/Ebitda multiple of 21x and 13x, respectively, as per Bloomberg consensus FY26 estimates. There are downside risks to earnings if sales volume ends up being lower than expected and material cost is higher than expected. If these play out and earnings estimates are indeed cut, then valuations could look pricier.
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Business Standard
23-05-2025
- Automotive
- Business Standard
Ashok Leyland earmarks Rs 1,000 crore capex for FY26: CFO Balaji
Hinduja Group flagship Ashok Leyland has earmarked about Rs 1,000 crore towards capital expenditure for the current financial year, a top official said on Friday. The city-headquartered heavy commercial vehicle manufacturer with a strong financial position of Rs 4,242 crore net cash would focus on investing in products and technologies in the current financial year. "The Capital Expenditure in FY25 we incurred was close to Rs 1,000 crore. And we will incur similar kind of capex for the coming year also (FY26)," company Chief Financial Officer K M Balaji told reporters. To a query on the investments that would be made in the subsidiaries during the financial year, he said it would be decided based on the requirement. "As far as investments in FY26, we will decide based on the requirements of the group companies. As of now, the requirements are visible from our Switch Mobility (EV division) and as well as in the Hinduja Leyland Finance. These are all some of the companies where we would invest and we will decide on the quantum as we progress during the financial year," he said. Adding to his point, Ashok Leyland Managing Director and CEO Shenu Agarwal said the company reported a net debt of Rs 89 crore in the previous financial year (FY24) and now it has become net cash surplus of over Rs 4,000 crore. "This means that we can really invest a lot of this cash in the future growth of the company. We are very clear that this future growth will come from the strengths of products and technologies that we offer to the market and also customer experience we offer to customers after the sales. So, in both these fronts we have some aggressive plans." Agarwal said. Ashok Leyland Ltd reported a 33.44 per cent rise in its consolidated net profit to Rs 1,245.92 crore in the January-March quarter, riding on robust sales and record revenue. The company had posted a consolidated net profit of Rs 933.69 crore during the corresponding quarter of last financial year. Commenting on the financial performance, Ashok Leyland Ltd Chairman Dheeraj Hinduja said, "Ashok Leyland achieved its highest ever Q4 and revenue, EBITDA, and PAT. This was our fourth consecutive quarter of double digit EBITDA margin. These record performances reflect the resilience of our business and trust of our customers that they have placed in us.", he said. On the exports front, he said, the strategy of going local in overseas business complemented by new products was progressing very well. To a query about the electric vehicle division Switch Mobility, he said, it "has a healthy volume with an order book of over 1,500 buses. We are launching new models in our bus portfolio as well. So, we are looking for a breakeven this financial year and with the restructuring we have done, that (achieving break even) is very much possible." On light commercial vehicle business, Agarwal said, "As we have already always been saying that LCV you know we see huge headroom in expanding our LCV business. "Firstly, you know we are restricted to 2-4 tonnage vehicles of that segment which is 50 per cent of the overall LCV industry. So, first I think the plan is how we can expand our product portfolio to cover 80 per cent of our LCV segment. Lot of effort will go into our R&D to see how we can create an LCV winning product to get that 30 per cent market share.", he said.
The Hindu
23-05-2025
- Automotive
- The Hindu
Ashok Leyland Q4 PAT rises 32% to Rs 1,130 crore, board okays 1:1 bonus share issue
Ashok Leyland Ltd for the fourth quarter ended March 31, 2025 reported consolidated net profit attributed to the owners of the company at Rs 1,130 crore as compared with Rs 853 crore in the year ago period, up 32%. The company's consolidated revenue from operations grew 6% Year on Year (YoY) to Rs 12,868 crore. Cash generated during the quarter was Rs. 3,284 crore. For FY25 the company's consolidated net profit attributed to owners of the company increased 25% to Rs 3,107 crore. Revenue from operations for FY25 grew 3% YoY to Rs 42,140 crore. The company ended the financial year with net cash of Rs. 4,242 crore, as against net debt of Rs. 89 crore at the end of the previous year. The board has declared bonus shares in the ratio of 1:1 subject to approval of shareholders. The company had paid two interim dividends, viz. first interim dividend of Rs. 2 per share in November 2024, and subsequently the second interim dividend of Rs. 4.25 per share in May 2025, aggregating to Rs. 6.25 per share of face value Rs. 1 (625%).'The second interim dividend may be considered as final dividend,' the company said. Dheeraj Hinduja, Chairman, Ashok Leyland Ltd. said, 'Achieving these record-breaking numbers is a matter of immense pride for us. It reflects the resilience of our business and the trust our customers place in us.' 'Given the company's strong financial performance in the last three years, the Board has approved a 1:1 bonus share issue. With our unwavering focus on innovation and customer satisfaction, and thrust in international operations, we are well-positioned for sustained and profitable growth,' he said. Shenu Agarwal, Managing Director & CEO, Ashok Leyland Ltd said 'FY25 has been another landmark year for us. We've set new records in revenue, EBITDA, and profitability. Our margin expansion and robust cash generation reflect the strength of our operations.' 'It also gives us immense satisfaction to achieve our medium-term goal of mid-teen EBITDA in Q4. The company is in a very strong cash position, ending the year with a cash surplus of Rs. 4,242 crore. This gives us more fuel to further augment our strengths in products and technology, and to offer best-in-class customer experience,' he said. 'We are continuing on our premiumization journey with high focus on delivering exceptional value to our customers. We are now more confident than ever in our ability to gain market share and further improve our price realization,' he added. The overall CV volumes at 195,093 units were very close to the previous high of 197,366. MHCV buses recorded ever highest volume of 21,249 units during the year. Export volume was also one of the highest in many years at 15,255 units, registering a growth of 29% over PY (11,853). The Power Solutions and Defence Businesses also posted impressive growth. The robust performance was driven by exceptional contribution from all business segments and well supported by the subsidiaries. 'For securing the future readiness, the alternate propulsion product portfolio is shaping well. Apart from electric vehicles led by Switch Mobility, which is on a growth trajectory, initiatives in LNG and Hydrogen are well under way,' Mr Agarwal said adding 'battery Electric and LNG vehicles will be adopter faster than Hydrogen.' In FY26 the company will have a capex of Rs 1,000 crore and is expecting breakeven at its Switch Mobility subsidiary.
Business Standard
21-05-2025
- Automotive
- Business Standard
Ashok Leyland Ltd soars 1.11%, up for third straight session
Ashok Leyland Ltd is quoting at Rs 244.6, up 1.11% on the day as on 12:49 IST on the NSE. The stock is up 17.48% in last one year as compared to a 9.62% gain in NIFTY and a 1.49% gain in the Nifty Auto index. Ashok Leyland Ltd rose for a third straight session today. The stock is quoting at Rs 244.6, up 1.11% on the day as on 12:49 IST on the NSE. The benchmark NIFTY is up around 0.36% on the day, quoting at 24771.7. The Sensex is at 81471.49, up 0.35%. Ashok Leyland Ltd has added around 9.85% in last one month. Meanwhile, Nifty Auto index of which Ashok Leyland Ltd is a constituent, has added around 8.07% in last one month and is currently quoting at 23531.2, up 0.6% on the day. The volume in the stock stood at 52.89 lakh shares today, compared to the daily average of 53.57 lakh shares in last one month. The benchmark May futures contract for the stock is quoting at Rs 240.35, up 0.62% on the day. Ashok Leyland Ltd is up 17.48% in last one year as compared to a 9.62% gain in NIFTY and a 1.49% gain in the Nifty Auto index. The PE of the stock is 24.32 based on TTM earnings ending December 24.
Economic Times
05-05-2025
- Automotive
- Economic Times
Stock Radar: Ashok Leyland breaks out from downward sloping channel; check target and stop loss
Ashok Leyland Ltd, part of the automobile space, broke out from a downward sloping channel pattern on the weekly charts which has opened room for the stock to head term traders with a high-risk profile can look to buy the stock for a target of Rs 260 in the next 2-4 stock hit a high of Rs 264 on August 27, 2024, but it failed to hold the momentum. It witnessed a steady decline which took the stock below crucial short- &
