Shares of Ashok Leyland, a renowned commercial vehicle manufacturer, witnessed a 4% increase following the company's announcement of a 5% year-on-year rise in vehicle sales for June 2023. The company experienced a 6% growth in medium and heavy commercial vehicle sales, while light commercial vehicle sales saw a 2% increase compared to the previous year. Over the past month, the stock has surged by 14%, and analysts hold an average target price of Rs 180. In the fourth quarter of FY23, the company's net profit experienced a 17% YoY decline, although revenue rose by 33%. However, for FY23, the net profit more than doubled, and revenue witnessed a remarkable growth of 67%.
During Monday's trade on the BSE, shares of commercial vehicles maker Ashok Leyland surged 4% to reach Rs 173.8. This boost followed the company's report of a 5% YoY growth in total vehicle sales, reaching 15,221 units in June 2023, compared to 14,531 units sold in the same month of the previous year.
In June, the company's domestic sales stood at 14,363 units, showcasing a 7% increase from the sales figure of 13,469 units in the corresponding period last year. The total sales of medium and heavy commercial vehicles (M&HCV) observed a 6% YoY rise, amounting to 9,962 units. Additionally, the sales of light commercial vehicles (LCV) also experienced a 2% YoY growth, reaching 5,259 units.
At 10.04 am, the company's shares were trading 2% higher at Rs 170.6 on the BSE. Over the past month, the stock has surged by over 14%, and in the past year, it has risen by more than 17%.
Based on Trendlyne data, the average target price for Ashok Leyland's stock is Rs 180, indicating a potential upside of 6% from the current market price. The consensus recommendation from 38 analysts is to 'Buy' the stock.
From a technical perspective, the stock's day RSI (14) currently stands at 70.4. RSI values below 30 are considered oversold, while values above 70 indicate an overbought condition, as per Trendlyne data. The MACD indicator is at 4.2, which is above both its center and signal line, signaling a bullish trend.
In the fourth quarter of FY23, Ashok Leyland reported a nearly 17% YoY drop in net profit to Rs 751.41 crore, despite a rise in revenue. The company's total revenue from operations witnessed an almost 33% YoY increase, reaching Rs 11,626 crore in Q4 FY23.
For FY23, Ashok Leyland's net profit showed an impressive surge of over twofold, amounting to Rs 1,380 crore, while the revenue witnessed a remarkable growth of 67%, reaching Rs 35,977 crore.
The company's operating profit, calculated as earnings before interest, taxes, depreciation, and amortization (EBITDA), rose to Rs 1,276 crore in the March quarter, compared to Rs 776.1 crore in the previous year. Operating margins expanded by 209 basis points YoY, reaching 10.97%.
