Ashok Leyland Q4 Review - Below Estimate; Operating Leverage Offsets Higher Raw Material Cost: Motilal Oswal
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Motilal Oswal Report
Ashok Leyland Ltd.’s Q4 FY21 revenue/Ebitda grew ~82%/192% YoY to Rs 70 billion/Rs 5.34 billion in Q4 FY21.
Adjusted profit after tax stood at Rs 2.1 billion.
Revenue/Ebitda declined by ~12%/54% to Rs 153 billion/Rs 5.4 billion in FY21. Adjusted loss stood at Rs 3 billion in FY21.
Gross margin declined by 580 basis point YoY (down 250bp QoQ) to 23.1% (estimate 24.2%), impacted by commodity cost.
Operating leverage more than offset the impact of higher raw material cost, resulting in a 290bp YoY (up 240bp QoQ) improvement in Ebitda margin to 7.6% (estimate 8.1%).
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