 "Ashok Leyland Q1 net up 25x to Rs 584 cr; plans Rs 800 cr capex in FY24")
Hinduja Group flagship company Ashok Leyland has posted a multi-fold jump in its consolidated net profit for the first quarter of the financial year 2023-24, at Rs 584 crore compared to only Rs 22 crore during the April-June quarter of FY23. An over 20-fold surge in sales volume across segments and a one-time deferred tax credit of Rs 172 crore on account of an expected transition to a lower tax regime contributed to the better show.
During the quarter under review, the company's revenue rose 14 per cent to Rs 9,691 crore from Rs 8,470 crore during the Q1 of the previous financial year. The company said on Friday that it is planning to invest Rs 750-800 crore during the current financial year. In the April to June quarter of the current year, its total expenses were up 8 per cent to Rs 9,065 crore, from Rs 8,379 crore during the year-ago quarter.
In the same period, Ashok Leyland’s domestic medium and heavy commercial vehicles (MHCV) volume grew by 7 per cent and market share rose from 30 per cent to 31.2 per cent. The MHCV truck market share was 31.7 per cent in Q1FY24 versus 31.1 per cent a year ago. This is the sixth straight quarter in which the firm has maintained over 30 per cent market share.
Volumes in the MHCV bus segment in the domestic market grew by 93 per cent from 1,593 units in the first quarter of the previous financial year to 3,077 units during the same time this year. In comparison the ed industry growth stood at 39 per cent. Its market share also increased from 20.2 per cent during Q1FY23 to 28.1 per cent in Q1FY24. The company’s domestic LCV volume in Q1 FY24 was 14,821 units, three per cent higher than Q1 of last year (14,384 units).
“In Q1, even after removing the adjustments of Rs 172 crore, we have seen our profits increasing by over five-fold. Going forward also, our aim is to grow faster than the industry. We have lined up a capital expenditure of Rs 750-800 crore during the current financial year,” said Gopal Mahadevan, chief financial officer of Ashok Leyland, addressing the media on Friday. The company’s EBITDA shot up to 10 per cent for Q1FY24 (Rs 821 crore) as against 4.4 per cent (Rs 320 crore) in Q1 of previous year. Net debt-to-equity stood at 0.2 times at end of Q1FY24.
With the industry maintaining the growth in Q1FY24, we have been able to post excellent results with focused market performance while reining in costs. We are pleased that we have continued to grow our market share in Q1. We are concurrently intensifying our efforts in international expansion. Through our electric vehicle subsidiary, Switch Mobility, we are actively moving towards net zero carbon mobility. The EV market is growing gradually, and we are geared to participating in this growth with a clear road map,” said Dheeraj Hinduja, Executive Chairman, Ashok Leyland.
The company’s managing director and chief executive officer Shenu Agarwal said that Ashok Leyland is seeing the growth in all segments and the rise in buses during the current quarter was owing to a lower base last year and the rise in demand this year due to business houses and schools reopening.