Ashok Leyland Q1 Turnover at Rs 2,348 cr, up 156%

Net profit at Rs 123 cr, up 15 times

Ashok Leyland, the Hinduja Group flagship, has registered a 156% increase in turnover to Rs. 2,347.98 crores (Rs. 918.07 crores) in the quarter ended June 30, 2010. Net Profit at Rs. 122.64 crores was up 15 times against Rs. 7.77 crores in the corresponding quarter of the previous year.

Sale of vehicles for the quarter was 21,400 numbers (7,693 nos.) with domestic volume at 19,460 nos. (6,790 nos) and international operations contributing 1,940 nos. (903 nos). 

Compared to the I Qtr of the last fiscal, the numbers make for very impressive reading with the Company having registered one of its best I Qtr performances, in terms of operating margins and volumes. Profit from operations before other income, financial expenses and exceptional items rose by 8 times at Rs. 173.93 crores (loss of Rs. 25.71 crores) signifying the benefits of larger volumes besides the Company’s ability to effectively contain the increase in raw material prices. Profit before financial expenses and exceptional item increased over 5 times at Rs. 178.66 crores (Rs. 29.29 crores).

Financial expenses at Rs. 31.62 crores (Rs. 25.80 crores) have increased reflecting the impact of fresh loans raised during second half of last fiscal and also due to lower interest capitalization consequent to commissioning of Pantnagar plant in Mar ‘10. Depreciation at Rs. 61.47 crores (Rs. 43.50 crores) is also higher this fiscal consequent to the commissioning of the Pantnagar plant.  

“Our I Qtr numbers reflect the momentum that we picked up in IV Qtr of the last fiscal which is reflected in the fact that we have gained market share touching 27%,” said Mr. R. Seshasayee, Managing Director, Ashok Leyland. “If freight demand continues to be robust, this trend should continue. However, there are some growth dampeners lurking in the form of supply chain constraints, rising interest rates, fuel and raw material prices,” he cautioned.

“Going forward, we envisage pre-buying prior to the introduction of the BS III emission norms across the country in October,” added Mr. Seshasayee, hinting that his earlier estimate of an industry growth of above 15% was still holding good.