Ashok Leyland Q1 Result: Automaker Logs Eightfold Increase In Net Profit

Ashok Leyland credited the boost to its domestic medium and heavy commercial vehicles (MHCV) segment which grew 7 per cent in volume

Ashok Leyland intends to focus on international expansion and achieving net zero carbon mobility goals. ( Image Source :Getty )

Commercial vehicles maker Ashok Leyland posted an eightfold increase in its net profit on a year-on-year (YoY) basis in its first quarter (Q1) earnings on Friday. The Chennai-based automaker logged a net profit of Rs 576 crore for the June quarter in the current financial year (FY24) against a net profit of Rs 68 crore in the first quarter of the previous fiscal year (FY23).

Ashok Leyland recorded a 13.5 per cent increase in its revenue for Q1 FY24 on a year-to-year basis. It posted a revenue of Rs. 8,189 crores for the current quarter against its Q1 revenue of Rs. 7,223 crores for FY23.

It credited the boost to its domestic medium and heavy commercial vehicles (MHCV) segment which grew 7 per cent in volume and 31.2 per cent in market share during the first quarter, as reported by PTI. The domestic light commercial vehicles (LCV) segment contributed a 3 per cent volume growth at 14,821 units from 14,384 units a year ago.

Executive Chairman, Dheeraj Hinduja, emphasised on the company's focus towards global expansion and net zero goals. He said, "We are concurrently intensifying our efforts in international expansion. Through our Electric Vehicle subsidiary, Switch Mobility, we are actively moving towards net zero carbon mobility. The EV market is growing gradually, and we are geared to participating in this growth with a clear road map."

The company posted a growth of 10 per cent in its EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) as compared to 4.4 per cent in the previous year. EBITDA is often used by companies as an alternative to net income to better understand their finances.

Research analyst Himanshu Singh from Prabhudas Lilladher Pvt Ltd, noted, "Overall, strong set of numbers on both revenue and margins, beating our and street’s consensus estimates. The company has noted that demand should improve from 2QFY24 onwards as 1Q volume performance was impacted due to pre-buying in 4QFY23 ahead of transition to BS VI Onboard Diagnostics (OBD) 2 norms,” as reported by Moneycontrol. The automaker also mentioned continued strong demand for its modular AVTR range of trucks.