Ashok Leyland - March 2013 Results Preview - Motilal Oswal

- Expect volumes to decline 4.2% YoY (+52% QoQ), with MHCVs down 23% YoY but LCV (Dost) volumes up 121%.

- Margins are likely to drop 110bp YoY, but rise 550bp QoQ on the back of higher volumes, price increase, and cost management measures initiated in Dec-12.

- Expect PAT to decline 45% YoY to INR1.42b on lower volumes, weak margins and high interest cost (higher inventory & receivables).

- We have cut our FY14E/FY15E EPS by 10%/8.1% respectively.

- The stock trades at 12.9x/9x FY14E/FY15E EPS respectively. Maintain Buy.

Source : Equity Bulls

Keywords