India’s second largest commercial vehicle maker Ashok Leyland disappointed analysts on Wednesday by reporting a sharp 66.5 percent decline in Q4 standalone profit at Rs 77 crore YoY. This was impacted by exceptional loss of Rs 379.3 crore (against Rs 8 crore YoY) and higher tax cost despite lower finance cost.
“Exceptional items consists of profit of Rs 41.7 crore on sale of long term investments and Rs 420.9 crore diminution in value of investments,” the company said.
Revenue increased 32 percent to Rs 5,955 crore in January-March quarter compared to Rs 4,505.7 crore in year-ago period, led by strong sales volume growth of 28 percent YoY.
Medium and heavy commercial vehicle sales grew by 34 percent to 35,246 units and light commercial vehicle sales rose by 11 percent to 8,745 units YoY.
Operating profit shot up 64.8 percent to Rs 753 crore and margin expanded by 250 basis points to 12.6 percent compared to corresponding period of last fiscal.
Revenue met expectations while operational performance was slightly below estimates. Profit was expected at Rs 420 crore on revenue of Rs 5,932 crore for the quarter, according to average of estimates of analysts polled by CNBC-TV18. Operating profit was estimated at Rs 761 crore and margin at 12.8 percent.
Margin was impacted a bit by other expenses, which increased 45 percent to Rs 635.8 crore compared to year-ago period. Tax expenses increased significantly by 160 percent to Rs 150.84 crore in same period.
Other income was lower by 14 percent to Rs 32 crore while finance cost declined 31.7 percent to Rs 60.2 crore against corresponding period of last fiscal.
Meanwhile, the board of directors of the company approved raising funds via non convertible debentures for up to Rs 700 crore and raising funds by issuing 13.5 crore shares via qualified institutional placement.
At 14:11 hours IST, the scrip of Ashok Leyland was quoting at Rs 97.20, down Rs 4.50, or 4.42 percent amid high volumes on Bombay Stock Exchange.