ICICI Direct's research report on Ashok Leyland
Ashok Leyland (ALL) is a pure-play CV manufacturer domestically, with H1FY23 market share pegged at 17.5%. The company is present in M&HCV trucks and buses as well as LCV goods segments. It also has a formidable presence in the e-mobility (electric buses) domain though Switch Mobility. • FY22 product mix – LCV goods 42%, trucks 52%, buses 6%.
Outlook
We retain BUY rating driven by cyclical recovery underway in domestic CV space amid robust capex allocation by government in budget 2023-24. Introducing FY25E, we value ALL at unchanged SOTP based target price of Rs 185 (12x core FY24-25E avg. EV/EBITDA, 2.0x P/B for invests).
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