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Informist, Wednesday, May 21, 2025

By Ishaan Sharma

MUMBAI - Ashok Leyland Ltd. is expected to report a strong growth in its net profit for the Jan-Mar quarter, due to a positive operating leverage, substantial rise in exports, and increase in demand for commercial vehicles. According to an average of estimates from 12 brokerages, the consolidated net profit of the company for the March quarter is expected to increase almost 24% on year to INR 11.08 billion.

The estimates for net profit range from INR 11.85 billion by Nuvama Wealth Management Ltd. to INR 9.64 billion by Prabhudas Lilladher Pvt. Ltd. Sequentially, the automobile maker's consolidated net profit is expected to rise over 45%.

Ashok Leyland's consolidated net sales are expected to rise 8% on year to INR 121.67 billion, the estimates showed. The lowest estimate for the top line was INR 118.32 billion by Motilal Oswal Financial Services Ltd., while the highest was INR 124.30 billion by Nuvama Wealth. Sequentially, its top line is expected to increase by more than 28%. Nuvama Wealth expects the commercial vehicle maker's net sales to grow in double digits on year due to volume growth and better product mix.

The company's medium and heavy commercial vehicle sales rose almost 4% during the Jan-Mar quarter to 36,056 units, from 34,754 units recorded in the corresponding quarter a year ago. Exports for the quarter under review increased nearly 52% to 5,460 units from 3,602 units year-on-year. However, light commercial vehicle sales saw a slight on-year decline of nearly 2%.

The company is expected to report earnings before interest, tax, depreciation, and amortisation of INR 16.88 billion for the March quarter, according to an average of estimates from 10 brokerages. The EBITDA is expected to be in the range of INR 14.86 billion to INR 18.00 billion.

Kotak Institutional Equities expects Ashok Leyland's EBIDTA margin to be flat on year due to a higher contribution from the non-automotive segment and commodity tailwinds offset by adverse pricing dynamics in the market. Motilal Oswal expects Ashok Leyland's EBITDA margin to remain stable on year at a little over 14%. Meanwhile, Nuvama Wealth expects EBITDA margin to expand on pricing discipline and cost savings.

Ashok Leyland will detail its earnings Friday. On Wednesday, shares of the company closed at INR 244.61 on the National Stock Exchange, up 1% from the previous close. The company's shares have risen nearly 12% since Feb. 12, the day when the company announced its December quarter earnings. Ashok Leyland had reported a consolidated net profit of INR 7.62 billion for the December quarter, on a revenue of INR 94.79 billion.

Following are the Jan-Mar earnings estimates for Ashok Leyland based on reports from 12 brokerage firms in descending order by the estimate of net profit (in INR billion):

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Edited by Nishant Maher

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