Bouncing back to black, Hinduja flagship commercial vehicle major Ashok Leyland (ALL) on Friday recorded a net profit of `6 crore for the third quarter of FY22 as against net loss of `19 crore in the corresponding quarter of last fiscal. ALL reported a 15% increase in revenues in Q3 FY22 at `5,535 crore as against `4,814 crore.
During the quarter, the company generated cash of `415 crore which brought down the net debt to `2,697crore. Debt equity as at the end of the quarter was at 0.42 times.
The company’s domestic LCV volumes for Q3 FY22 was at 14, 233 (15,991) constrained by semi-conductor shortage. Export volumes (MHCV & LCV) were at 3,177, higher than Q3 FY’21 by 8% (2,941).
In Q3 FY22, ALL’s MHCV domestic truck and bus volumes have grown at almost twice that of industry at 39% compared to the TIV growth of 20%. Consequently, its MHCV market share has improved sequentially by 3.6% in Q3 (from 22.5% in Q2 to 26.1% in Q3).
To address the growing demand for ICV CNG vehicles, ALL has recently introduced the first of the trucks from the CNG stable – the Ecomet Star – based on the highly successful Ecomet platform. The company plans to launch further vehicles in Q4 of the current year under the CNG range which will further strengthen ALL’s presence in this segment.
Dheeraj Hinduja, executive chairman, ALL, said “The CV industry is on a recovery owing to the improvement in the macroeconomic environment and healthy demand from the end-user industries. The MHCV segment is expected to lead the recovery in the coming months riding on the back of growth in core sectors such as construction & mining, increased capital outlay for infrastructure projects, conducive financing environment and pent up replacement demand.”
Hinduja said LCV volumes should grow further owing to the increased demand for last mile connectivity, especially from the e-commerce segment. The focus on exports, defence, power solutions and parts businesses will ensure a balanced growth, even as we expand the reach and the products of our core MHCV business. We are hoping that the commodity prices will decrease further and the situation on the semi-conductor will ease.”
The board of directors of the company has also approved the issuance of secured and redeemable non-convertible debentures (NCDs) aggregating upto `250 crore on a private placement basis in one or more tranches / series.
Gopal Mahadevan, director & CFO, ALL, added, “The higher volumes and our cost management initiatives have helped us improve our bottom line. We have generated close to `300 crore in cash this quarter owing to improved working capital, and we will continue to focus on driving operational efficiency.”
