Arihant Capital has given Hold recommendation for Ashok Leyland with a target price of Rs. 132 in its research report issued on Aug 20, 2021

Arihant Capital’s research report on Ashok Leyland

Ashok Leyland (AL) has reported a mixed set of numbers during Q1 FY22.Good performance in the revenue growth While de-growth on the EBITDA and net loss. Standalone revenue stood at INR 29,346 Mn, against our estimate of INR 28,518 Mn registering +354.8% YoY/-57.9% QoQ. Gross margin of the company decreased by 998bps YoY at 25.9% due to commodity cost pressure like steel was impacting business. EBITDA stood at INR -1,401 Mn, against our estimate of INR 869 Mn, Registering -58%YoY/-126.2%QoQ. On the margins front, EBITDA margin was contracted by 1238bps QoQ to -4.7%, against our estimate of 3%.

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