Boosted by an exceptional gain, Ashok Leyland posted a 10.44 per cent rise in third quarter net profit at Rs 74 crore.
The commercial vehicle maker’s revenue dropped 18 per cent to Rs 2, 381 crore from the corresponding quarter last year.
During the quarter, there was an exceptional gain of Rs 156.25 crore, due to “part sale of non-current investments.” The company has, in fact, posted a loss of Rs 83.80 crore, from ordinary activities after finance costs but before the exceptional item — compared to a profit of Rs 72 crore for the same period last year.
Volumes for the quarter were down at 22,661 units, from 23,175 units in the corresponding quarter last fiscal.
Employee cost in the quarter decreased 4 per cent to Rs 262 crore. But other expenditure increased 13 per cent to Rs 306 crore; financial expenses were up 78 per cent to Rs 107 crore.
Challenges
“Against the backdrop of a sluggish economy and weak macro-economic indicators, quarter three was bound to be an extremely challenging one for a GDP-driven industry as ours,” said Vinod K. Dasari, Managing Director, in a press release.
However, its LCV Dost continued its good run with a market share of 18 per cent. The spare and power solutions businesses also grew robustly, said a company release.
“We have made significant inroads into new international markets with non-SAARC markets (West Asia, Africa, CIS and Latin America) almost offsetting the loss from an under-performing Sri Lankan market,” said Dasari. The company also said it has gained in the growing ICV (individually constructed vehicles) segment.
Commenting on the current quarter, Dasari said, “Historically Q4 is the most robust of quarters but in the present scenario, the entire commercial vehicle industry hopes for some Government-initiated stimuli soon that will help turn the tide, improve sentiments and give the entire economy a much-needed fillip.”
The company’s stock was down 2.40 per cent on the BSE, on Thursday, at Rs 24.40.