Earnings Today: Price Hikes, Lower Discounts To Aid Ashok Leyland In Q2

Ashok Leyland, Bharat Forge and Mahanagar gas among companies reporting Q2FY18 results.

BQ Research @bqprime

08 Nov 2017, 08:22 AM IST

A man walks between two Ashok Leyland Ltd. goods-carrier trucks parked at a toll plaza in Mumbai. (Photographer: Abhijit Bhatlekar/Bloomberg News)

Commercial vehicle maker Ashok Leyland Ltd., auto parts supplier Bharat Forge Ltd., and natural gas distributor Mahanagar Gas Ltd. are among companies reporting July-September quarter results today.

Ashok Leyland may see a 33 percent rise in profit aided by higher sales volumes during the quarter, according to the Bloomberg consensus estimate. Revenue too may grow 33 percent to Rs 6,180 crore. The growth is expected to be driven by price hikes on new Bharat-Stage IV emissions compliant vehicles and lower discounts. Operating margin may however contract to 11 percent.

Earnings Today: Price Hikes, Lower Discounts To Aid Ashok Leyland In Q2

What To Watch

Update on commercial vehicle demand
Raw material costs and outlook
Update on after-market presence and network expansion

The Kalyani Group-run Bharat Forge is expected to see a 57 percent jump in profit on the back of higher shipments during the quarter. Revenue seen rising 40 percent to Rs 1,250 crore year-on-year, according to the Bloomberg consensus estimate. Operating margin may improve 100 basis points to 28.8 percent aided by higher sales volumes. Operating income is expected 45 percent higher at Rs 360 crore.

What To Watch

Outlook for Class 8 trucks in the U.S.
Outlook for oil and gas, and mining segment.

Mahanagar Gas may report a 5 percent sequential increase in profit to Rs 130 crore, according to consensus estimate of analysts tracked by Bloomberg. Sales volumes during the quarter is expected to grow 4.3 percent due to the encouraging conversion rate of vehicles to a CNG-fitted engine. Revenue may grow 6 percent, while operating income is seen rising 4 percent. However, margin may narrow 70 basis points to 37.6 percent.