Ashok Leyland Q2 result preview: PAT likely to rise three-fold; revenue estimated to grow two-fold

Ashok Leyland, the flagship company of the Hinduja Group and India’s leading commercial vehicle manufacturer, is all set to announce its Q2FY24 results on Thursday, November 9. The company is expected to report a healthy quarter with three-fold growth in its standalone profit after tax (PAT) to Rs 605 crore (with exceptional gains of Rs 8 crore from the April to June quarter) as against Rs 199 crore logged in the corresponding quarter of the previous fiscal.

According to Zee Business Research, Ashok Leyland is likely to report a 20 per cent growth in its revenue to Rs 9,915 crore as against Rs 8,266 crore registered in the same quarter a year ago.

Further, the earnings before interest, tax, depreciation, and amortisation (EBITDA) for the quarter under review are likely to come in at Rs 1,105 crore as against Rs 537 crore registered in the year-ago period, which implies a rise of 2.1 times year-on-year (YoY).

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The margin, a key to measuring profitability, is expected to grow by 460 basis points (bps) to 11.1 per cent from 6.5 per cent in the same quarter a year ago.

Zee Business analysts estimate the company's volume to increase by 10 per cent to 49,846 units, and realisation is estimated to increase by 9 per cent to Rs 19.88 lakh on the back of a reduction in price hikes and discounts.

As per Zee Business analysts, the company's EBITDA margin is likely to increase due to a decline in input prices and better operating performance. They expect a two-times increase in other income and will keep an eye on the demand outlook for H2FY24.

Here's how Ashok Leyland fared in Q1

Ashok Leyland reported a standalone net profit of Rs 576.42 crore for the quarter ended June 30, 2023. The revenue from operations came in at Rs 8,189.29 crore while its operating margin stood at 10.02 per cent.

The company's domestic medium and heavy commercial vehicles (MHCV) volume grew 7 per cent during the quarter under review, and the market share grew to 31.2 per cent from 30 per cent.

Ashok Leyland price: Past performance

Since January, Ashok Leyland shares have grown over 16 per cent in value, compared to a nearly 7 per cent rise in the headline Nifty50 index.

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