Ashok Leyland Q3 Results Review - Stung Show, Muted Near Term Demand: Dolat Capital

Dolat Capital Report

Ashok Leyland Ltd.'s printed strong margin performance in Q3, Ebitda margin stood at 12% led by cost control effort and pricing discipline. Management is confident to sustain double digit margin on the back of cost cutting measures and benign raw material prices.

Management expects a marginal decline in volume Q4 on high base. Moreover, Q1 FY25 to remain soft due to general elections, and demand to improve after Q2 FY25.

Stock is trading at 19/18 times for FY24/25E earning per share appear fully priced at the almost top of CV cycle.

We maintain Reduce with target price Rs 183 (based on 18 times FY26E EPS). Maintain 'Reduce'.

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