In today’s trading session, Ashok Leyland shares experienced a notable decline, plunging 3% to Rs 227.2. This drop contrasts with the BSE AUTO index, which saw a modest increase of 0.2%, currently standing at 57,204.7. Among the BSE AUTO index’s top losers today are Tata Motors, down 0.3%, and TVS Motors, down 0.1%. Meanwhile, Eicher Motor and Tube Investments of India emerged as the top gainers, rising by 1.2% and 1.0%, respectively.
Ashok Leyland’s performance over the past year has been impressive, despite the recent dip. The company’s share price has risen from Rs 167.2 to Rs 227.2, marking a significant gain of 35.9%. However, when compared to the broader BSE AUTO index, Ashok Leyland’s growth appears modest. The BSE AUTO index has surged from 34,767.3 to 57,204.7 over the same period, registering a remarkable 64.5% increase.
This indicates a robust overall performance in the automotive sector, driven by strong performances from stocks like Motherson Sumi, Cummins India, and Bajaj Auto, which have seen gains of 137.7%, 108.4%, and 105.3%, respectively.
In the broader market, the BSE Sensex also displayed positive momentum, climbing 0.6% to 79,880.3. HDFC Bank and Axis Bank were among the top gainers, with HDFC Bank surging 3.1% and Axis Bank rising 1.8%. The most traded stocks on the BSE Sensex today included Tata Steel and HDFC Bank, indicating strong investor interest. On the NSE Nifty, which also rose by 0.6% to 24,261.5, HDFC Bank and Tata Consumer Products were prominent gainers.
Over the last 12 months, the BSE Sensex has experienced a significant rise from 65,205.1 to 79,880.3, a gain of 22.5%. This broader market growth underscores a generally positive economic environment, which has benefited many sectors, including automotive, banking, and consumer goods.
Ashok Leyland’s recent financial performance provides additional context to its stock movement. For the quarter ended March 2024, the company’s net profit grew by 17.2% year-over-year to Rs 9,279 million, compared to Rs 7,918 million in the same period the previous year. Net sales also saw an increase of 2.8%, rising to Rs 135,776 million from Rs 132,026 million in January-March 2023.
Looking at the annual performance for the year ended March 2023, Ashok Leyland reported a dramatic turnaround, with net profit soaring by 577.0% to Rs 13,617 million, compared to a net loss of Rs 2,855 million during FY22. The company’s revenue also saw substantial growth, increasing by 58.8% to Rs 416,726 million during FY23.
Despite the recent decline in its share price, Ashok Leyland’s financial health appears strong, with robust growth in both profit and revenue over the past year. The current P/E ratio of Ashok Leyland, based on rolling 12-month earnings, stands at 24.9, suggesting that the stock is reasonably valued relative to its earnings performance.
