Ashok Leyland's Q3 FY2020 net profit at Rs 28 crore, down 92%

Ashok Leyland today reported its financial result for Q3 FY2020 with a revenue of Rs 4,016 crore against Rs 6,325 crore for the same period last year. The EBITDA for the quarter came at 5.6 percent.

The weak result could probably be attributed on the back of the slowdown in the overall as well as the M&HCV industry, the volumes had come down by 39 percent. During the quarter the company reported PAT at Rs 28 crore (-92%), compared to Rs 381 crore for the same period last year.

Vipin Sondhi, MD and CEO Ashok Leyland said: “The industry continued to witness a decline in volume (39%). Ashok Leyland also witnessed a volume drop in this quarter. Despite this, we have been able to achieve an EBITDA of 5.6 percent. We have been seeding our range of heavy duty BS VI vehicles in the market, well before the April 2020 deadline. We have done extensive testing on the innovative iEGR solution, which is a specially designed innovative, intelligent, and indigenous solution that uses Mid-NOx technology. We are confident that with this, we will be providing the best suited solution for Indian conditions. Along with the rollout of the BS VI vehicles, we will also be introducing our unique Modular Business Platform that will give our customers the flexibility to choose vehicles as per their requirement.”

Gopal Mahadevan, Whole Time Director and CFO, Ashok Leyland said, “We continue our productivity and cost reduction programs started earlier in the year. These initiatives have helped us achieve a sizeable reduction in costs. We are also focusing on cash flows and conserving resources for future growth initiatives”.

Ashok Leyland was the first Indian OEM to receive BS VI certification for its entire range of heavy duty trucks (GVW 16.2 tonnes and above) in early November 2019. The CV maker is deploying a combination of iEGR, SCR and DPF to meet BS VI emission norms. It claims the technology combination offers 'better margin to meet future norms' as SCR doesn't have to operate in optimal capacity. This move is in contrast to its peers, who are betting on the SCR and DPF combination to meet the stringent BSVI norms. For smaller engines, mainly for LCVs, Ashok Leyland may use LNT (Lean NOx Trap) instead of iEGR to bring down technology cost.  Ashok Leyland has been testing this new technology and have successfully covered over 5 million kilometers of field tests.