Recovery hopes drive gains for pure-play CV maker Ashok Leyland

Street expects trend to continue with valuations supporting upmove

Ashok Leyland was the biggest gainer among auto stocks on Friday rising 4 per cent stretching its returns to over 15 per cent over the past month. The stock has outperformed its peers on the back of expectations that it will be a key beneficiary of the recovery in the economy.

An analyst at a foreign brokerage says that cyclicals tend to gain the most as the economy recovers, with Ashok Leyland being ahead of the pack as it is the only pure play commercial vehicle (CV) maker. Government spending on infrastructure and fiscal expansion policy should boost demand initially