Ashok Leyland, the country's second largest commercial vehicle maker, will declare its third quarter (October-December) earnings on Tuesday. Analysts on an average expect another loss for the company due to very low volumes, high discounts, and high interest and depreciation cost.
According to CNBC-TV18 poll, the company is expected to post a net loss of Rs 170 crore during December quarter as against profit of Rs 74.2 crore in a year-ago period. Revenues may decline 19 percent year-on-year to Rs 1,935 crore in the quarter gone by.
In the above loss, following two extraordinary items are not included - 1) Profit on sale of IndusInd Bank shares in Q3 (Ashok Leyland sold 1.8 million (all) shares of IndusInd Bank at Rs 417 per share); and 2) VRS (10 percent of workers opted for voluntary retirement scheme) announced on November 8.
On the operational front, most analysts expect the company to report another EBITDA loss (earnings before interest, tax, depreciation and amortisation) due to sharp increase in discounts and negative operating leverage on a Y-o-Y basis.
Volumes
Total volumes of the company dropped 18.6 percent year-on-year (down 20.2 percent Q-o-Q) to 18,453 units due to slump in demand in the quarter gone by.
Medium and heavy commercial vehicle volumes slipped 26.6 percent on yearly basis to 10698 units while light commercial vehicle (Dost) volumes declined 4.1 percent Y-o-Y to 7,755 units.
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