Ashok Leyland reports Q3 PAT at Rs 6 cr

Hinduja Group flagship Ashok Leyland on Friday reported a profit after tax for the quarter ending December 31, 2021 at Rs six crore, the company said.

The city-based medium and heavy commercial vehicle maker had reported a net loss at Rs 19 crore during corresponding quarter previous year. Revenues for the quarter under review stood at Rs 5,535 crore as against Rs 4,814 crore registered during corresponding period of last fiscal.

The domestic medium and heavy commercial vehicle volume during the period grew by 15 per cent to 16,667 units as compared to 14,468 units, a company statement said.

Domestic light commercial vehicle volumes during the quarter was at 14,233 units as against 15,991 units constrained by the semi-conductor shortage, it said.

Exports of medium, heavy commercial vehicle and light commercial vehicle grew by eight per cent during the quarter under review to 3,177 units as against 2,941 units reported in same period of last year.

The company, during the quarter generated cash of Rs 415 crore which brought down the net debt as on December 31, 2021 to Rs 2,697 crore. “Debt equity as at the end of the quarter was 0.42 times”, it said.

During the quarter under review, the domestic truck and bus volumes grew by almost twice that of industry at 39 per cent compared to the total industry volume growth of 20 per cent. “Consequently, Ashok Leyland MHCV market share improved sequentially by 3.6 per cent in 3qtr “, it said.

On the Intermediate Commercial Vehicle business, Ashok Leyland said it recently introduced the first of the trucks from the CNG stable — the Ecomet STAR — based on the highly successful Ecomet platform.

“The company plans to launch further vehicles in Q4 of the current year under the CNG range…,” it said.

The electric vehicle business under Switch Mobility continues to expand and grow with Switch United Kingdom announced the setting up of a manufacturing unit in Spain.

“In 3qtr, Switch won a 300 electric bus order from Bangalore Metropolitan Transport Corporation. The company had also commenced the supply of the 40 units electric bus order from the Chandigarh Transport Undertaking”, it said.

Commenting on the financial performance, Ashok Leyland, Executive Chairman Dheeraj Hinduja said, “the CV industry is on a recovery owing to the improvement in the macroeconomic environment and healthy demand from the end-user industries.

“The MHCV segment is expected to lead the recovery in the coming months riding on the back of growth in core sectors such as construction and mining, increased capital outlay for infrastructure projects, conducive financing environment and pent up replacement demand,” he said.

Light commercial vehicles volume should grow further owing to the increased demand for last mile connectivity, especially from the e-commerce segment, he said.

The focus on exports, defence, power solutions and parts businesses will ensure a balanced growth, even as we expand the reach and the products of our core MHCV business, he said. “We are hoping that the commodity prices will decrease further and the situation on the semi-conductor will ease”, he added.

Ashok Leyland Director and CFO Gopal Mahadevan said, the higher volumes and our cost management initiatives have helped us improve our bottomline.

“We have generated close to Rs 300 crore in cash this quarter owing to improved working capital, and we will continue to focus on driving operational efficiency,” he said.