Ashok Leyland Q1 preview: Brokerage see double digit fall in profit, EBITDA

Ashok Leyland is expected to report around 5-7 percent year-on-year decline in revenue and double-digit fall in profit & EBITDA for the quarter ended June 2019, dented by weak volumes, according to brokerages.

In Q1FY20, Ashok Leyland's volume decline was limited to 6 percent against around 9-18 percent fall for its competitors.

Total volumes of the quarter were at 39,608 units.

"Net sales in Q1FY20 is expected to fall 7.5 percent YoY. EBITDA is likely to slip 19 percent and PAT may fall 28 percent YoY," said ICICI direct which said the product mix worsened with light commercial vehicle (LCV) to medium & heavy commercial vehicle (M&HCV) ratio in Q1FY20 at 33:67 against 26:74 in Q4FY19 and 27:73 in Q1FY19.

But Kotak expects the maximum decline in profit at 62 percent YoY and EBITDA at 40 percent YoY. "We expect EBITDA margin to decline 390 bps YoY, led by 240 bps YoY decline in gross margin and negative operating leverage," it said.

Disclaimer: The views and investment tips expressed by brokerages on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.