Ashok Leyland posts net loss in Q2, revenues down 28 percent

Commercial vehicle manufacturer Ashok Leyland’s Q2FY2021 revenues dropped 28 percent year on year to Rs 2,837 crore from Rs 3,929 crore in Q2 FY2020. The sharp revenue dip is primarily on the back of muted commercial vehicle sales. The Q2 sales for Ashok Leyland this fiscal stood at 19,445 commercial vehicles compared to 28,936 units a year-ago.

The company also reported a consolidated net loss of Rs 96.23 crore in Q2FY2021 compared to Rs 69.95 crore profit in Q2FY2020.The flagship of the Hinduja Group however reported a sharp recovery in sequential performance and revenues in Q2 were up 3.4 times compared to Rs 651 crore in Q1F20Y21. 

Following the successful launch of its Modular Platform AVTR, the company continued its planned product launches of the Bada Dost in the Phoenix Platform in the LCV segment and Boss LE and LX in the ICV segment. 

The company reported a positive EBITDA of 2.8 percent in Q2 FY2021 against an EBITDA of -51.2 percent in Q1 FY2021. They also generated Rs 1208 crore of cash from operations after capital expenditure and investments, which has helped the company bring down net debt to Rs 3076 crore in Q2 from Rs 4,284 crore in Q1 FY2021.

Vipin Sondhi, MD and CEO, Ashok Leyland Limited said “While the challenges in the market due to COVID-19 continue, the company has seen a marked improvement in the Company’s performance in this quarter. The performance of our newly launched AVTR platform in the M&HCV segment and Bada Dost in the LCV segment gives us immense confidence that we are on the right track. Our innovative I-gen6 (Mid-NOx) BS6 solution has received a very positive response from customers. As we go forward our focus on customer acquisition and network expansion will continue.”

Gopal Mahadevan, Whole Time Director & CFO, Ashok Leyland added, “The performance for this quarter which resulted in a positive EBITDA of 2.8 percent was made possible owing to the revenue enhancement and operational efficiency initiatives of the company during challenging times. All the a-cyclical businesses including LCV, After Market, Defence and Power Solutions have performed really well during the quarter. Focus on operating cost and material cost optimization will continue, even as we pursue growth.”

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