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Ashok Leyland reviews Rs 147 crore Q2 loss as a consequence of weak demand for business automobiles

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MUMBAI: Hinduja Group flagship Ashok Leyland on Friday reported Rs 147 crore loss for the September quarter as revenues declined 28% as a consequence of weak demand for business automobiles within the wake of the pandemic and overcapacity within the transport sector.

Revenue for the fiscal second quarter fell to Rs 2,837 crore from Rs 3,930 crore a yr earlier. The firm had reported a revenue of Rs 39 crore within the corresponding quarter final yr.

Earnings earlier than curiosity, tax, depreciation and amortisation (Ebitda) declined by 65% to Rs 80 crore whereas Ebitda margin contracted by nearly Three share factors to 2.8%.

“While the challenges out there as a consequence of Covid-19 proceed, the corporate has seen a marked enchancment within the firm’s efficiency on this quarter,” managing director Vipin Sondhi said. “As we go ahead, our concentrate on buyer acquisition and community growth will proceed,” he added. In the previous quarter, the corporate incurred a lack of Rs 389 crore as income declined by 89% year-on-year to Rs 651 crore.

Ashok Leyland generated Rs 1,208 crore of money from operations after capital expenditure and investments, which helped it deliver down internet debt to Rs 3,076 crore from Rs 4,284 crore within the earlier quarter, based on a press release from the corporate.

“We expect Ashok Leyland’s volume to fall by 26% in FY21, while it would record strong 106% and 18% growth in FY22 and FY23, respectively,” stated Mitul Shah, the pinnacle of analysis at Reliance Securities. Shah predicted the corporate’s market share to be steady and assumed its Ebitda margin “conservatively” at 10.8% in FY22 and 11.4% in FY23.

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