The working results of Ashok Leyland for the third quarter of 2012-13 show a revenue drop of 18 per cent to Rs. 2,381 crores as against Rs. 2,903 crores for the corresponding quarter of the previous fiscal. Net profit for the quarter was, however, up by 11 per cent at Rs. 74 crores (Rs. 67 crores).
The employee cost decreased by four per cent at Rs. 262 crores (Rs. 272 crores). Other expenditure increased by 13 per cent at Rs. 306 crores (Rs. 272 crores), and financial expenses were up by 78 per cent at Rs. 107 crores (Rs. 60 crores).
For the nine months ended December 2012, sales revenue was higher by two per cent at Rs. 8,684 crores (Rs. 8,531 crores). Net profit was, however, down eight per cent at Rs. 284 crores (Rs. 307 crores).
The results include a gain of Rs. 156.26 crores on part-sale of investments.
Although the production volume for the quarter at 22,661 units (23,175 units) was marginally lower, the company did gain in a falling market with its market share expanding by 2.5 per cent in the M&HCV space. This was largely attributable to gains across regions, except the South where it was flat, and the success of the newly-introduced models.
The company consciously accelerated its investments in new products to provide maximum value to customers. It gained in the growing ICV segment on the back of better acceptance of the Ecomet range of vehicles while the initial market feedback to the recently launched multi-axle vehicles (MAVs) with twin-speed rear axles and the 5-axle 3718il have been very encouraging.
The ‘DOST’ continued its successful run with an 18 per cent market share even though it is in a ramp-up mode with its presence in nine States.
The Ashok Leyland network expanded rapidly. The company has now 435 full-service centers on all the major highways of the country, while the programme of appointing new dealers has also paid off with significantly better contribution coming from the new entrants.
Apart from the LCV business, the Spare and Power Solutions businesses also grew robustly. In fact, December 2012 saw the highest-ever sale of engines in a particular month at 3,444 units. On the international operations front, the performance of non-SAARC markets like the Middle East, Africa, CIS and Latin America was very impressive.
Said Mr. Vinod K. Dasari, Managing Director, Ashok Leyland: “Against the backdrop of a sluggish economy and weak macro-economic indicators, quarter III was bound to be an extremely challenging one for a GDP-driven industry as ours. However, despite strong headwinds, we have been able to turn in a fairly creditable performance with market share gains across regions and product segments, the aggressive network expansion programme yielding rich dividends, the LCV, spares and power solutions businesses doing exceedingly well and significant inroads made into new international markets with non-SAARC markets almost offsetting the loss from anunder-performing Sri Lankan market.”
As for future prospects, Mr. Dasari remarked: “Historically Q4 is the most robust of quarters, but in the present scenario the entire commercial vehicle industry hopes for some Government initiated stimuli soon that will help turn the tide, improve sentiments which would in turn give the entire economya much-needed fillip.”