Hinduja Group flagship company Ashok Leyland Ltd posted a 142 per cent rise in net profit at Rs 363.39 crore for the fourth quarter ended March 31, 2014, as against Rs 150.03 crore for the same period previous fiscal. The increase in profit was mainly due to exceptional items, including sale of non-core assets.
In the fiscal 2014, the company retained the market share in an intensely competitive medium and heavy commercial vehicles (M&HCV) market, which declined by over 25 per cent for the second year in a row, said Vinod K Dasari, managing director of Ashok Leyland.
Total income dropped 17.5 per cent during the quarter to Rs 3,076.8 crore from Rs 3,728.46 crore previous year ago.
"In a very tough year, we restructured ourselves to reduce the overall fixed costs to invest in new products, network and sales," he said.
Revenues from exceptional items increased to Rs 376.01 crore from Rs 134.36 crore, led by dilution of stakes in some of the companies and selling non-core assets including lands and others. It made a profit of around Rs 200 crore by selling around 5 million shares in IndusInd Bank.
According to Gopal Mahadevan, CFO of Ashok Leyland, the company aims to achieve a debt-to-equity ratio of 1:1 from the current 1.14:1. It will continue the debt reduction programme and will sell some of the non-core assets in the fiscal 2014-15.
In the fiscal 2013-14, it had brought down debt worth Rs 1,500-crore by offloading non-core assets. As on August 2013, its debt stood at Rs 6,200 crore. "Sentiment is better now. We hope with a stable government at the Centre, things would improve," said Dasari.On the capital expenditure plan, he said, the company was almost done with its capex programme. "Between 1987 and 2007, every year we were investing around Rs 100 crore. Between 2008 and 2013, we invested around Rs 100 crore every month."
The capex was largely on capacity expansion for the manufacture of cabins and engines.
