Ashok Leyland Posts Net Loss Of Rs 167 Crore For Q3FY14

Ashok Leyland (ALL), one of the biggest participants in large and medium commercial vehicle segment, posted disappointing financial performance for its third quarter of FY14 on YoY basis. The sales in this quarter dropped by 19%, due to the decline in volume sales and higher discounts given by company during the quarter (YoY). The medium and heavy vehicle sales volume dropped by 26% and the large vehicle sales dropped by 9% during the quarter in FY14. Also, the slowdown in the commercial vehicle segment has impacted the demand of large vehicle.

Due to the decline in sales EBITDA was also affected heavily and reported a loss of Rs 96.9 crore against an income of Rs 341 crore during Q3FY14. 

Its bottom line affected drastically on yearly basis. Net loss for December quarter stood at Rs 167 crore against profit of Rs 74 crore for Q3FY13. The company is in loss from the last three quarters in the current financial year. Higher interest costs in Q3FY14 of Rs 115 crore as compared to Rs 107 crore in Q3FY13 has added to the losses.

Against the poor financial performance, announced yesterday (January 21, 2014), ALL’s stock price is trading up by 3% from the previous close of Rs 16.80. The management expects a good growth in Q4FY14, backed by the improved demand in the large vehicle segment.

The company earlier said that it will again provide higher discounts in the January month on its various models of commercial vehicles to boost the sales performance in Q4FY14.