Views on Ashok Leyland 2QFY16 Result: Angel Broking

Views of Mr. Bharat Gianani (Sr. Research Analyst - Automobile, Angel Broking) on Ashok Leyland 2QFY16 Results:

"Ashok Leyland 2QFY16 results were below estimates on back of lower than expected topline and higher depreciation charge. Revenues grew 54% YoY to INR 4,940 cr coming lower than our estimates of INR 5,281 cr. Volume growth has been robust at 51% driven by a 64% growth in the MHCV space. However blended realization/vehicle grew 2% YoY to INR 14.08 lakh coming lower than our expectations of INR 15 lakh possibly due to slightly unfavourable product mix. EBIDTA margins at 12% improved sharply 490 bp YoY and were at five year highs coming broadly in line with our estimates of 12.6%. Soft commodity prices and operating leverage led to sharp margin improvement. However, given the topline miss, the EBIDTA at INR 594 cr was lower than our estimates of INR 668 cr. Further, higher depreciation expenses at INR 113 cr also impacted profitability. Net Profit at INR 287 cr was below our expectations of INR 355 cr. We currently have BUY rating on the stock."

Shares of ASHOK LEYLAND LTD. was last trading in BSE at Rs.92.15 as compared to the previous close of Rs. 90.35. The total number of shares traded during the day was 2872877 in over 10690 trades.

The stock hit an intraday high of Rs. 93.45 and intraday low of 91.6. The net turnover during the day was Rs. 265925864.

Source : Equity Bulls

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