With 71 per cent growth in profit after tax (PAT) figures, Ashok Leyland seems to be in an extended Diwali mood. These PAT figures are for the second quarter that ended on September 30, 2016.
Gopal Mahadevan, CFO of Ashok Leyland said, “While we will pursue growth, we would want to do it profitably. The team continues to be focused on operating costs and margins. Finance costs have come down by nearly 50 per cent with the working capital under control. Debt equity is at 0.3.”
Total M&HCV segment sales fell by 14 per cent in Q2 of this year. The commercial vehicle manufacturers in this category managed to sell only 66,592 units, which was 77,249 units in the same time frame last year. Ashok Leyland registered a seven per cent decline in its revenues generated in Q2 of FY 2017 but registered 34 per cent growth in terms of exports in the same quarter.
Confident with new products on the line, Vinod K Dasari, Managing Director, Ashok Leyland Limited, said, “The highlight for us this half year is the sustenance of operating margins as we stayed away from deep discounting. This is in spite of it being a tough second quarter for the industry, due to the base effect. Our continued focus on controlling costs has paid rich dividends and has helped us shore up the bottom line. We are confident that the coming months will see a positive trend for the commercial vehicle industry on the back of good monsoons and economic revival. We expect the recent introductions in the ICV segment – Guru (Truck) & Sunshine (Bus) to have a very positive impact on our volumes.”
The breakup between Nissan and Ashok Leyland seems to be doing wonders for the homegrown commercial vehicle maker.