Ashok Leyland (ASHOKLEY) Q2 24/25 earnings summary

Executive summary

• Q2 FY25 saw a 9% YOY revenue decline to INR 8,769 crore, but net profit rose 37% YOY to INR 770 crore, marking an all-time high, with management optimistic for H2 and medium-term growth.

• Domestic M&HCV truck volumes fell 18% YOY, but bus volumes rose 8% YOY; overall domestic M&HCV volumes were 25,685 units versus 29,947 last year.

• Sequentially, domestic M&HCV truck volumes rose 2%, and market share improved to above 31%, with leadership in the bus segment and gains in LCV market share.

• Export volumes grew 14% YOY and 42% sequentially, with strong performance in GCC, Africa, and new entry into Southeast Asia.

• Interim dividend of Rs. 2 per share declared, payable on or before December 7, 2024.

Financial highlights

• EBITDA for Q2 was INR 1,017 crore, margin at 11.6% (up from 10.6% in Q1 and 11.2% last year), the seventh consecutive quarter of double-digit EBITDA.

• Operating PBT was INR 878 crore, nearly flat YOY.

• Reported PAT rose 37% YOY to INR 770 crore, driven by improved price realization and cost efficiencies.

• Standalone revenue from operations for Q2 FY25 was Rs. 8,768.83 crore, up from Rs. 8,598.53 crore in Q1 FY25.

• Net debt reduced to INR 501 crore from INR 1,139 crore last year and INR 1,295 crore in Q1.

Outlook and guidance

• Management expects H2 to be flattish or positive, with no degrowth anticipated, supported by high fleet utilization and favorable macroeconomic indicators.

• Base effect from last year’s weak Q4 and election disruptions expected to support growth.

• Continued focus on mid-teen EBITDA, 35% M&HCV market share, and growth in non-CV and alternate fuel businesses.

• International expansion in SAARC, Middle East, Africa, and Asia is a strategic priority.