Ashok Leyland - Results above est.; Maintain HOLD on weak outlook - Emkay

Reco: HOLD
CMP: Rs 24
Target Price: Rs 24

- Q2FY13 results beat estimates on better than anticipated operating performance

- We maintain our negative stance on M&HCV industry as fleet operator profitability continues to remain under pressure - channel checks indicate the scenario is likely to continue

- We factor in 4% decline in domestic volume for AL in FY13 (+10% in FY14), as against mgmt. guidance of a small growth

- Raise margin est by ~50 bps and FY13/14 EPS by 5%/12% - raise TP to Rs 24; Maintain HOLD on weak outlook. Stock trading at 7.0x/6.1x FY13/14 EV/EBITDA and 2.1x/1.9x P/BV

Source : Equity Bulls

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