{"id":7097,"date":"2015-03-21T12:42:46","date_gmt":"2015-03-21T07:12:46","guid":{"rendered":"https:\/\/blog.fundsindia.com\/blog\/?p=7097"},"modified":"2015-03-21T12:42:46","modified_gmt":"2015-03-21T07:12:46","slug":"ashok-leyland-ltd-reliable-and-consistent","status":"publish","type":"post","link":"https:\/\/www.fundsindia.com\/blog\/equities\/ashok-leyland-ltd-reliable-and-consistent\/7097","title":{"rendered":"Ashok Leyland Ltd: Reliable And Consistent"},"content":{"rendered":"<p style=\"text-align: justify;\"><span style=\"line-height: 1.5em;\">The company established in September 1948, Ashok Leyland is the second largest\u00a0<\/span>manufacturer of MHCVs (Medium &amp; Heavy Commercial Vehicles) in India, the\u00a0fourth largest manufacturer of buses in the world and the sixteenth largest\u00a0manufacturer of trucks globally. Ashok Leyland is the flagship company of the\u00a0Hinduja group, with the group holding 51% stake in the company.\u00a0Headquartered in Chennai (India), the company is one of the most fullyintegrated\u00a0manufacturing companies with its footprints across 50 countries\u00a0across the globe.<\/p>\n<p style=\"text-align: justify;\"><strong>Valuation and View<\/strong><\/p>\n<p style=\"text-align: justify;\">Given the positive outlook for MHCVs, revival in economic\u00a0growth and Ashok Leyland\u2019s focus on exports and low-growth\u00a0LCV segment, we expect improvement in the company\u2019s\u00a0performance in the coming quarters. Further, the plans to\u00a0lower down the discounts currently offered to boost sales\u00a0volume are expected to push revenue. Moreover, the\u00a0company has been able to take price hikes during the past\u00a0quarters to offset the discounts. Besides, the company has laid\u00a0focus on working capital management and accordingly\u00a0lowered its working capital requirement. Going ahead, the\u00a0positive operating leverage from volume growth will be\u00a0beneficial to the margins. Further, on the back of cost control\u00a0initiatives taken by the company, we expect some uptick in\u00a0margins in the coming quarters.<\/p>\n<p style=\"text-align: justify;\">At a current market price (CMP) of Rs 70.8, the stock trades at\u00a0an EV\/EBITDA of 16.6x FY16E and 13.7x FY17E. We\u00a0recommend \u2018BUY\u2019 with a target price of Rs 84.7, which implies\u00a0potential upside of ~19.6% to the CMP from long term\u00a0perspective.<\/p>\n<p style=\"text-align: justify;\"><a href=\"https:\/\/www.fundsindia.com\/blog\/wp-content\/uploads\/2015\/03\/Research-Report-Ashok-Leyland-Ltd.pdf\">Research Report Ashok Leyland Ltd<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The company established in September 1948, Ashok Leyland is the second largest\u00a0manufacturer of MHCVs (Medium &amp; Heavy Commercial Vehicles) in India, the\u00a0fourth largest manufacturer of buses in the world and the sixteenth largest\u00a0manufacturer of trucks globally. Ashok Leyland is the flagship company of the\u00a0Hinduja group, with the group holding 51% stake in the company.\u00a0Headquartered in [&hellip;]<\/p>\n","protected":false},"author":14,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[59],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v17.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Ashok Leyland Ltd: Reliable And Consistent<\/title>\n<meta name=\"description\" content=\"Find the latest research report on Ashok Leyland Ltd. on FundsIndia Marketplace\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fundsindia.com\/blog\/equities\/ashok-leyland-ltd-reliable-and-consistent\/7097\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" 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