Ashok Leyland skids into red

Ashok Leyland is amongst the top losers of the day, currently down over 1.2% at Rs.16.40, its current intra day low. 

The stock is down following its dismal sales figure for November wherein the company reported a 27% (YoY) drop in sales at 5375 units.  In commercial vehicles, sales fell 39% at 2715 units. Its main driver for the past few months, Dost has also not done too well. Clubbing Dost and Stile under small commercial vehicles, sales dropped 8% at 2660 units.

The company posted a set of very disappointing numbers for Q2FY14. The second largest commercial vehicle maker of India, posted a net loss at Rs.25 crore v/s net profit of Rs.142 crore in Q2FY13 on a 20% drop in total revenue at Rs.2650 crore. The only good news here is that the loss for Q2 was lower than the Rs.142 crore loss it posted for Q1FY14. The loss in Q2 would have been much higher but for the Rs.48 crore coming in from sale of long term investment. Its EBITDA % improved from 1.5% in Q1 to 3.1% in Q2 in the current fiscal due to better cost management. The total vehicle sales during the quarter was down 22% (YoY) and the down turn only seems to continue with the company.