Ashok Leyland Q3 PAT likely to jump 2.8 times YoY

Ashok Leyland, the second largest commercial vehicle maker, is likely to report a profit after tax of Rs 121 crore in the third quarter of FY12 versus Rs 43.3 crore in a year ago quarter.

Revenues are seen going up by 31% to Rs 2,918 crore from Rs 2,227 crore year-on-year.

Operating profit margin is expected to be at 10.1% in the October-December quarter of FY12 versus 7.4% in the corresponding quarter of last fiscal and 10.6% in an earlier quarter.

On quarter-on-quarter basis, revenues are likely to fall 5.6% and PAT is seen going down 21.4%.

What to watch out for:

* Strong volume growth of 25% YoY, low base effect playing up

* Stable input costs and better volume ramp up to help margins remain stable QoQ

* However, adverse product mix in form of higher LCV's to prevent margins from getting above 10.1%

* Realisations to degrow by 7% QoQ despite 1% price hike taken by company due to dilutive impact on product mix on account of higher LCV

* With issues in south India getting resolved, may improve market share back to 22-23% level by end FY12

Volume growth in Q3

- Total sales went up 25% YoY (down 1.7% QoQ) at 23215 units versus 18437 units

- MHCV sales moved up 26% YoY at 23000 versus 18258 units

- Exports went down 14% YoY (down 6% QoQ) at 3017 versus 3513 units

- LCV was up at 215 versus 179, some volumes from new launch Dost