Recovery in MHCV sales helps Ashok Leyland gain 7% rise in shares
Sales of Ashok Leyland in June helped the company's shares rise by nearly 7% on Monday.
- Ashok Leyland's stocks sky rocked on Monday as it's shares closed nearly 7% up
- It's highest rise in its shares in a month
- On BSE rose to close at 6.82% or Rs 6.40
Ashok Leyland's stocks sky rocked on Monday as it's shares closed nearly 7% up. This is the highest rise in its shares in a month to close just above Rs 100 per share on both BSE and NSE.
The country's leading medium and heavy commercial vehicle (MHCV) manufacturer's shares on BSE rose to close at 6.82% or Rs 6.40, at Rs 100.25 per piece. On NSE, the company's shares closed higher at 7.14% or Rs 6.70, at Rs 100.55 per piece.
This large growth in a day came as the company reported an 11% growth in overall sales in the month of June. This was mainly due to the high 29% growth in sales of its light commercial vehicles (LCVs) during June.
Ashok Leyland sold 3,128 units in June 2017 in comparison to 2,423 units sold in June 2016.
The MHCV sales too saw a 6% growth in sales as it sold 9,202 units in June 2017 in comparison with 8,685 units during the same month last year.
Total sales of the company stood at 12,330 units in June 2017 in comparison with 11,108 units sold in the same month last year.
This rise in sales came as a welcome news to investors that had seen the company's MHCV sales struggling due to the impact of demonetisation and the Bharat Stage IV ban.
For instance, in May Ashok Leyland posted a huge 18% decline in MHCV sales. It's MHCV sales declined to 6,129 units in May 2017 in comparison with 7,469 units in the same month last year.
This rise in MHCV sales indicates a recovery of the segment in which it leads and hence the rise in its shares.
However, during the April to June quarter its MHCV sales was down 17% as sales 19,877 units during April to June 2017 from 24,027 units sold in the corresponding period last year.
LCVs however saw a 21% jump in sales during the same quarter.
Besides this, Ashok Leyland reported a net profit of Rs 476.17 crore in the fourth quarter of the FY17 in comparison with a net loss of Rs 140.81 crore in the corresponding period last year. It's net sales rose 10.79% to Rs 6,617.89 crore in Q4 FY17 as against Q4 FY16.