Ashok Leyland Posts Highest Profit In Over a Decade, Announces 1:1 Bonus Issue

Ashok Leyland Ltd. wrapped up the March quarter with its strongest performance in more than 10 years, reporting record-high net profit and revenue. The truck and bus maker posted a consolidated net profit of ₹12.46 billion, up more than 38% on year, driven by lower tax expenses and a dip in raw material costs. The figure topped analysts’ expectations of ₹11.08 billion and marked the third straight quarter of profit growth.

Revenue rose nearly 6% on year to ₹119.07 billion, although it came in below the Street’s forecast of ₹121.67 billion. Sequentially, the bottom line soared 64% and revenue rose 26%.

Lower input costs helped shore up margins, with raw material expenses – which form the bulk of the company’s outgo – falling 1.6% on year to ₹73.72 billion. Employee costs, however, jumped 18% on year to ₹6.52 billion, while other expenses edged up 3% to ₹10.61 billion. Total expenditure stood at ₹103.42 billion, up a little over 4% from a year earlier. Tax expenses dropped 18% to ₹4.11 billion, helping boost the bottom line.

For 2024-25, Ashok Leyland reported a 26% rise in net profit to ₹33.03 billion, while full-year revenue rose marginally to ₹387.53 billion.

Operating performance was robust, with March-quarter EBITDA rising over 12% on year to ₹17.91 billion. For the full year, EBITDA rose more than 7% to ₹49.31 billion. Operating margin for the quarter expanded to 15.04% from 14.13% a year ago.

The company ended the year with a net cash surplus of ₹42.42 billion, a dramatic turnaround from net debt of ₹890 million the previous year. Cash generation for the quarter stood at ₹32.84 billion.

Commercial vehicle sales brought in ₹129.27 billion during the March quarter, up from ₹121.47 billion a year earlier, making up 88% of consolidated revenue of ₹146.96 billion. Revenue from financial services also grew to ₹17.69 billion from ₹13.96 billion.

Total commercial vehicle volume for 2024-25 reached 195,093 units, just shy of the all-time high of 197,366 units. The company saw record sales of medium and heavy buses at 21,249 units. Exports were strong as well, climbing 29% to 15,255 units. Growth in power solutions and defence segments also stood out.

“We are continuing on our premiumisation journey with a high focus on delivering exceptional value to our customers,” said Managing Director and CEO Shenu Agarwal. “We are now more confident than ever in our ability to gain market share and further improve our price realisation.”

In a shareholder-friendly move, Ashok Leyland also announced a 1:1 bonus issue of equity shares.