Ashok Leyland Share Price Rose ~3% After Q2 FY25 Earnings Release

On November 11, 2024, Ashok Leyland shares were trading up by 2.68% at 10:00 AM, reaching a day high of ₹230.00 following the release of its Q2 FY25 results on November 8, 2024. The positive movement in the stock price came after the company reported strong earnings for the September quarter, with a notable 37% year-on-year increase in its bottom line, which stood at ₹770 crore, compared to ₹561 crore in the same period last year.

However, despite the robust profit growth, Ashok Leyland’s topline saw a decline of 9% year-on-year, with revenue falling to ₹8,769 crore from ₹9,638 crore in the corresponding quarter of the previous year. This decline in revenue was largely driven by weaker demand in certain segments, despite gains in others.

Declared Dividend With Increased Earnings

The company reported a 5.8% increase in earnings before interest, tax, depreciation, and amortization (EBITDA), which amounted to ₹1,017 crore. This performance exceeded market expectations, which had forecasted an EBITDA of ₹954 crore. Additionally, the operating margin improved by 40 basis points, rising to 11.6% from 11.2% in the same quarter last year.

In a positive move for shareholders, the Ashok Leyland Board declared an interim dividend of ₹2 per equity share (with a face value of ₹1 each) for the financial year ending 2024-25. The dividend is set to be paid by December 7, 2024, with the record date for determining eligible shareholders fixed as November 19, 2024.

Maintained Strong Market Position

Ashok Leyland continues to maintain a strong market position in the domestic Medium and Heavy Commercial Vehicle (MHCV) segment, with a market share exceeding 31%. The company has also maintained its leadership in the bus segment and has seen growth in the Light Commercial Vehicle (LCV) segment within its addressable markets during the first half of the year.

Dheeraj Hinduja, Executive Chairman at Ashok Leyland remains optimistic about industry prospects for the second half on the back of strong macroeconomic fundamentals, supported by resumption of Government spending in capex and good monsoons.

“Our PAT for Q2FY25 is at an all-time high. Our EBITDA margins have improved both sequentially and on a YoY basis, making this the seventh consecutive quarter of double-digit EBITDA. We are well on track to achieve mid-teen EBITDA in the medium term,” said Shenu Agarwal, MD and CEO at Ashok Leyland.

On November 11, 2024, Ashok Leyland shares opened at ₹223.45 and touched the day high of ₹230.00 at 10:15 AM, reflecting a gain of 2.66% from the previous close.

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