A mechanic services a truck in Manesar, Haryana, India. (Photographer: Udit Kulshrestha/Bloomberg)  

Q3 Results: Ashok Leyland Surges After Profit Beats Estimates

Ashok Leyland Ltd.’s quarterly profit fell less-than-anticipated beating the average analyst estimate.

Net profit declined 21 percent year-on-year to Rs 381 crore, the truck maker said in its exchange filing today. That compares with the Rs 275-crore consensus estimate of analysts tracked by Bloomberg.

Revenue fell 12 percent to Rs 6,325 crore compared with the same period last year, in line with the estimated Rs 6,300 crore. This comes as company’s monthly sales fell the most in nearly two years in December to 15,493 units after a muted festive season.

The slowdown in sales during November and December was due to a higher base, said its Managing Director and Chief Executive Officer Vinod Dasari in an interview with BloombergQuint last month . “It is a temporary blip. If you look at the larger picture from April-December, the overall volume is up by about 25 percent.”

Operating income, or the earnings before interest, tax, depreciation and amortisation, fell 22 percent year-on-year to Rs 650 crore while operating margin contracted to 10.3 percent from 11.7 percent.

The company, in a press release filed along with results, said it had successfully completed Bharat Standard VI compliance testing across its entire range of engines as the government plans its implementation from April next year.

In the near term, I expect gains from the Bharat Standard VI pre-buying in the next fiscal. Equally hope that post elections, there will be greater spending on defence as we will then see orders for the many tenders won by us over the last couple of years.
Vinod Dasari, Managing Director and Chief Executive Officer, Ashok Leyland in a press release.

The company’s shares rose 10.3 percent to Rs 87.10 after the earnings announcement, compared with S&P BSE Sensex’s 0.3 percent decline.

Q3 Results: Ashok Leyland Surges After Profit Beats Estimates