Ashok Leyland up 4% after targeting Ebitda break-even for its arm in FY25

Ashok Leyland shares advanced 3.7 per cent in trade and registered an intraday high of Rs 230.4 per share on BSE. The stock was in demand after Executive Chairman, Dheeraj Hinduja, told Business Standard that the company's financial position was "very comfortable" and it will continue to support Switch and Ohm. 

 

Switch Mobility and Ohm Global Mobility are both subsidiaries of the automobile company Ashok Leyland.

 

Around 12:17 PM, Ashok Leyland shares were up 2.27 per cent at Rs 227.05 per share on BSE. In comparison, the BSE Sensex was up 0.45 per cent at 79,844.24. The market capitalisation of the company stood at Rs 66,671.58 crore. The 52-week high of the stock was at Rs 264.70 per share on BSE and 52-week low of the stock was at Rs 157.65 per share.

 

 

"We will continue to fund Switch; when we see the right time or if we find good investors, we will be open to that. At this point, we are continuing to grow ourselves. When you see good products coming and the profitability of the company increasing, automatically the valuation created for Ashok Leyland and its shareholders will also be substantially more," Hinduja said.

 

Hinduja expects Switch India to achieve Ebitda (earnings before interest, taxes, depreciation, and amortisation) break-even during the current financial year. With this, he believes the company will be able to meet its operating expenses using the revenue generated from operations. 

 

"We initially progressed slowly as rates were not attractive. Now, rates have risen as the competition has also adjusted the rates they are bidding at. We are performing well in our product offering, service, and range. In all aspects, our service performance is very good," he said.

 

Ashok Leyland recorded an 11.6 per cent rise in Ebitda for the July-September quarter (Q2FY25) at Rs 1,017 crore, compared to 11.2 per cent (Rs 1,080 crore) in the corresponding quarter of the previous financial year. Through various measures, the company has managed to increase its margins from 8 per cent two years ago to 13 per cent last year.

Ashok Leyland dividend

The company declared an interim dividend of Rs 2 per equity share of Re 1 each.

 

In the past one year, Ashok Leyland shares have gained 31 per cent against Sensex's rise of 22 per cent.