Ashok Leyland Jan sales surge 34%; targets 25% market share

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Ashok Leyland Jan sales surge 34%; targets 25% market share

Commercial vehicle maker Ashok Leyland's total sales in January accelerated 34% year-on-year to 10,300 units. The sales growth was boosted by 1,100 unit sales of its new launched light commercial vehicle Dost.

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Commercial vehicle maker Ashok Leyland 's total sales in January accelerated 34% year-on-year to 10,300 units. The sales growth was boosted by 1,100 unit sales of its new launched light commercial vehicle Dost.

Excluding Dost, the Hinduja Group company's sales last month rose 19% from a year ago to 9,200 units.

Over April-January period, Ashok Leyland sold 76,621 units, up 6% from a year ago, which included 3,800 units of Dost. Excluding Dost, its slaes over the 10-month period were up just 1%.

In an interaction with reporters, K. Sridharan, Ashok Leyland's CFO said that the company was targeting a 25% market share by the end of the current fiscal year. IT currently has around 23% market share.

He said the company hoped to ramp up production to around 4,000 units per month, from around 3,000 per month currently to achieve its market share target.

CV industry volumes were growing at 9% year-on-year, Sridharan said, adding the company had offered higher discounts in the third quarter.

Ashok Leyland had on Wednesday reported a 54% year-on-year jump in third quarter net profit at Rs 67 crore, while revenue was up 29% to Rs 2,880 crore.

Sequentially, however, the company's net profit was down 56% and EBITDA margin contracted a steep 340 basis points sequentially to 7.3% due to higher employee and other expenses, and that disappointed investors.

During the three-month period, Ashok Leyland's employee costs rose 12% from a year ago to 272 crore due to bonus paid to employees. It also had one-time exchange loss of Rs 15 crore in the quarter, Sridharan said.

Other expenses in Oct-Dec rose 42% to Rs 268 crore.

Sridharan said higher other expenses were a one-time occurrence and sees operating margins stabilizing at 10%.

Ashok Leyland shares were down over 5% at 27.15 on NSE in afternoon trade.