Ashok Leyland’s turnover grows 6 percent in Q1

Ashok Leyland, the flagship of the Hinduja Group, has registered a 6.3 percent increase in turnover to Rs. 2,495.5 crores (Rs. 2,348 crores) in the quarter ended June 30, 2011.

Sale of vehicles for the quarter stood at 19,277 numbers (21,400 nos.) with domestic volume at 16,738 nos. (19,460 nos.) and international operations contributing 2,539 nos. (1,940 nos.). The drop in domestic volume was primarily in the South, the Company’s stronghold for long, which also resulted in a loss of overall market share.

The Company’s EBIDTA at Rs. 244.6 crores is marginally better than in the previous year (Rs. 234.8 crores) despite Employee Costs being higher at Rs. 249.7 crores (Rs. 202.5 crores). Depreciation was higher by 37.7 percent at Rs. 84.7 crores (Rs. 61.5 crores). Financial Expenses rose to Rs. 53.3 crores (Rs. 31.6 crores) on the back of an increase in working capital which is now being brought under control.

The Company’s Profit before Financial Expenses and Exceptional Item was at Rs.164.1 crores (Rs. 178.7 crores). The Company’s Profit from Ordinary Activities before Tax was at Rs. 110.7 crores (Rs. 147.0 crores). Net profit was at Rs. 86.3 crores as against Rs. 122.6 crores for the corresponding quarter in the previous year.

“After the robust growth of 2010-11, the first quarter of this fiscal has seen a significant moderation,” is how Mr. Vinod K. Dasari, Managing Director, Ashok Leyland, put it. “The rise in cost of ownership due to spiraling input costs, the rise in fuel prices, hardening interest rates and a fall in freight availability all contributed to this moderation. While our domestic performance was subdued, the over 30% jump in our exports helped shore up our numbers,” he added.

Speaking about the quarter ahead, he said, “We are cautiously optimistic of the coming months because the fundamentals remain strong and the India growth story continues. We have the launch of DOST, the first light commercial vehicle from the Ashok Leyland-Nissan stable and the construction equipment products in association with John Deere which will make the coming quarter interesting,” he concluded.