Ashok Leyland riding well on economic recovery

The outlook for Ashok Leyland, going forward, looks promising as demand has picked up and is better than the pre-COVID levels. Moreover, its strong product portfolio and an increase in market share augur well for the company. The valuation also gives us desired comfort

Nitin Agrawal
May 23, 2022 / 09:53 AM IST
PRO Only Highlights
Quarterly performance largely backed by improved realisations
Medium-term triggers China plus and protectionist measures for tyre industry
Valuations not inexpensive; but improved medium-term outlook

Riding on the tailwind for the commercial vehicle (CV) industry, the final quarter of FY22 was very strong for Ashok Leyland (CMP: Rs 130, Mcap: Rs 38,250 crore). Volume, an important performance indicator for the company, improved substantially sequentially. Operating profitability also improved on the back of significant operating leverage. The outlook going forward looks promising as demand has picked up and is better than the pre-Covid levels. Moreover, its strong product portfolio and an increase in market share augur...