Ashok Leyland, the Indian flagship of the Hinduja Group, on Friday reported a whopping 747 per cent surge in its net profit to Rs 576 crore for the first quarter ended June 2023, on the back of an expansion in revenues and efficient cost management. The company’s revenue during April-June 2023 stood at Rs 8,189 crore, which is 13.37 per cent higher than the Rs 7,223 crore reported in the year-ago period.
The company had posted a net profit of Rs 68 crore in the corresponding period last year.
During the latest June 2023 quarter, Ashok Leyland’s domestic MHCV volume grew 7 per cent and market share grew from 30 per cent to 31.2 per cent. The MHCV truck market share was at 31.7 per cent for Q1FY24 as against 31.1 per cent in the same period last year.
The company’s domestic LCV volume in Q1 FY24 was 14,821 units, 3 per cent higher than in Q1 of last year (14,384 units).
MHCV stands for medium & heavy commercial vehicles, while LCV stands for light commercial vehicles.
Ashok Leyland’s Ebitda shot up to 10 per cent for the June 2023 quarter to Rs 821 crore as against 4.4 per cent (or Rs 320 crore) a year ago. Ebitda stands for earnings before interest, tax, depreciation and amortisation.
The company’s net debt-to-equity ratio stood at 0.2 times at the end of Q1FY24.
Shares of Ashok Leyland on Friday were trading higher by Rs 6.10 or 3.47 per cent to Rs 181.75 apiece on the BSE at 12.41 pm.
Ashok Leyland Q1 Results: Why This Huge Jump In Net Profit?
“The company continued to see strong demand for the modular AVTR range of trucks. The efforts on network expansion also helped the uptick in revenue and market share. In the LCV segment as well, the volumes grew on the back of good market acceptance of our Bada Dost range. The power solutions and aftermarket businesses continued to contribute strongly to the topline (revenue) of the company,” Ashok Leyland said in a statement.
Tax expense for the quarter was lower as it considers a one-time deferred tax credit of Rs 172 crore on account of the expected transition to a lower tax regime in the following financial year.
Dheeraj Hinduja, executive chairman of Ashok Leyland, said, “With the industry maintaining the growth in Q1 FY24, 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.”
He added that through its electric vehicle subsidiary, Switch Mobility, the company is actively moving towards net-zero carbon mobility. The EV market is growing gradually, and the company is geared to participate in this growth with a clear road map.
Shenu Agarwal, MD & CEO of Ashok Leyland, said, “With the expansion in revenues and efficient cost management we have seen our bottom line improving substantially. While we continue to expand our market penetration on the back of efficient products and expanding the network, we shall remain acutely focused on achieving and sustaining double-digit profitability. This is important for us as we focus on improving our resilience and investing in technologies of the future.”