Company attributes the profit rise to higher infra spends and tight working capital.
India’s third largest commercial vehicle maker Ashok Leyland on Tuesday beat analyst expectations with a 232 percent rise in net profit for the June quarter, led by a sustained growth in domestic demand helped by strong uptick in infrastructure activity.
Ashok Leyland said that net profit came in at Rs 370 crore, compared to the Rs 356.3 crore crore average of 15 analysts’ estimates in a Reuters poll. Net profit for the same quarter in 2017-18 had come in at Rs 111.2 crore.
Vinod K Dasari, Managing Director, Ashok Leyland said: "The total industry volume registered 84 percent growth primarily driven by surge in infrastructure spend resulting in higher sale of Tipper and MAVs. There was also the impact of base effect. We continued our focus on profitable growth and tight control on working capital, in a market which operated on heavy discounting and credit push."
Net sales of the company came in at Rs 6,250 crore, a growth of 38 percent compared to Rs 4,534 crore in the corresponding year-ago period. The Reuters poll had expected the revenues to come in at Rs 6,359 crore.
The maker of trucks and buses — sold under brands like Dost, Captain, Ecomet and Janbus — closed the June quarter with sales of 42,128 units, a rise of 48 percent compared to 28,498 units sold in the same quarter last year.
Sales in the domestic circuit grew by 51 percent to 38,119 units while exports grew by 22 percent to 4,009 units, as per data supplied by the Society of Indian Automobile Manufacturers
Domestic sales of two-wheelers clocked a growth of 20 percent to 497,587 units over 413,539 units while two-wheeler exports reported a growth of 25 percent to 358,802 units as compared to 287,478.At 1.11 PM, its shares were 5.53 percent higher at Rs 132.70 on the Bombay Stock Exchange.