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Hinduja flagship Ashok Leyland has reported a significant fall in its net profit at ₹230 crore for the quarter ended June 30, 2019 when compared with a net profit of ₹422 crore in the year-ago quarter, on the back of sluggish market conditions in the commercial vehicle sector.
The company’s revenue fell nine per cent to ₹5684 crore when compared to ₹6263 crore in the June quarter of previous fiscal.
After maintaining double-digit EBITDA for several quarters in the past, the Chennai-headquartered truck and bus maker’s EBITDA for this June quarter fell to 9.4 per cent. It was 10.4 per cent in the year-ago quarter.
Our EBITDA at 9.4 per cent despite decline in revenues signifies efficient cost management in the Company. Despite a drop in TIV (total industry volume) by five per cent, our LCV business continues to do very well and posted a growth of 12 per cent,” Dheeraj G Hinduja, Chairman, Ashok Leyland Limited said in a statement.
Meanwhile, Ashok Leyland has seen an increase in its market share in the medium and heavy commercial vehicle segment (include both trucks and buses) to 34.1 per cent from 30.1 per cent in June 2018 quarter.
“While the industry has witnessed a decline in the volume of 17 per cent Ashok Leyland’s market share has grown by 4 per cent,” said Hinduja.
CV industry expects the overall CV demand to come back in the second half of this fiscal mainly because of seasonality and expected consumer spending.
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