The Hindu Business Line : Ashok Leyland’s Q3 net rises 12% on other income; turnover flat

Ashok Leyland has reported a 12 per cent increase in its net profit for the third quarter, but that was mainly because of substantially higher ‘other income’.

Turnover was flat, but ‘other income’ was up seven times, because of the proceeds of sale of shares of IndusInd Bank — another entity of the same, Hinduja group.

Ashok Leyland’s net profit for the quarter ended December 2007 was Rs 120.20 crore compared with Rs 105.25 crore in the corresponding quarter of last year.

The 12 per cent growth in net profit sharply contrasts with the 1 per cent growth in turnover — Rs 1,800 crore, against Rs 1,775 crore previously.

‘Other income’ was up at Rs 43.70 crore against Rs 6.30 crore previously.

The truck manufacturer sold fewer vehicles during the quarter — 18,965 vehicles against 20,051 in the corresponding quarter of last year. However, a press release from the company notes that the revenues were higher because of the company sold “more fully-built vehicles and larger volumes in engines and spares.”

Interest charges also grew to Rs 15 crore (Rs 2.5 crore, previously), due to “higher capex and working capital requirements.”

Ashok Leyland’s Managing Director, Mr R. Seshasayee, expects sales to pick up in the fourth quarter. “We will gain from new models such as the 4921, 3121 and 2214 Super which are already fielded and being well received by the market. With improving contribution from our international operations, we hope to end the year with a high single digit growth in overall sales volume,” Mr Seshasayee said in the press release.

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