Ashok Leyland net profit jumps 32% in Q2

Commercial vehicle maker Ashok Leyland today reported a jump of 31.77 per cent in its net profit for the quarter ended September 30, 2009 at Rs 88.61 crore on account of internal efficiencies and low input costs.

The company had posted a net profit of Rs 67.24 crore in the corresponding period, Ashok Leyland said in a statement.

The net sales during the second quarter, however, declined by 15.65 per cent to Rs 1,577.68 crore from Rs 1,870.47 crore in the year-ago period, it added.

In the three-month period, the company sold 14,297 units of vehicles compared with 17,207 units in the same period last year, down 16.91 per cent.

"The improved profitability has been achieved through tighter control on working capital and operating costs, aided by lower material costs," Ashok Leyland said.

For the entire fiscal, the company is expecting a double-digit growth on the back of revival in the commercial vehicles market.

"With the economy expected to grow at around 6 per cent, the overall growth prospects look favourable for industry. The commercial vehicle market too is in a robust turnaround phase. The firming up of freight rates is a positive sign," Ashok Leyland Managing Director R Seshasayee said.

"We anticipate significant volume pick up in the second half leading up to a double digit growth in the current fiscal," he added.

The Hinduja Group firm's scrip today closed 3.53 per cent up at Rs 45.45 on the Bombay Stock Exchange.