Sharekhan's research report on Ashok Leyland
Q4FY21 results beat street expectations, led by better average realization and sharp EBITDA margin expansion. We expect ALL’s profitability to improve significantly, with its EBITDA growing at 159% CAGR for FY2021-23E, aided by robust 38.2% revenue CAGR and sharp margin expansion. The stock trades below average historical multiples at P/E of 17.7x and EV/EBITDA of 9.9x its FY2023E estimates.
Outlook
We retain a Buy on Ashok Leyland with an unchanged PT of Rs 151, given the expected recovery in the CV industry post normalisation of economic activities.
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