- 26 Jul 2024
- ICICISEC
Ashok Leyland reports muted performance, margins disappoint
ASHOKLEY - 246 Change: 13.95 (6.00 %)News: Standalone operating income for Q1FY25 came in at ₹ 8,598 crore, up 5% YoY amid 6% growth in volumes to 43,893 units. EBITDA for the quarter came in at ₹ 911 crore with margins at 10.6%, down 350 bps QoQ. Consequent PAT in Q1FY25 came in at ₹ 526 crore (down 9% YoY, due to lower tax incidence in base quarter). Share of M&HCV in total volume mix for the quarter stood at 63.5% vs. 66% in Q4FY24.
Views: Gross margins deteriorated marginally by 35 bps QoQ while rise in other expenses was the real dampener and was up 170 bps QoQ. Management commentary is positive on demand prospects with the overall EBITDA margin aim retained at mid-teens. With healthy order wins in the buses segment in the recent past and stable growth trajectory, we are positive on the stock with long term investment horizon.
Impact: Neutral