Large cap auto stock in green after it received ₹ 800 Cr order from Indian army for Gun Towing Vehicles

The shares of the world’s biggest manufacturer of medium-duty defence vehicles, with a 32 percent market share in the medium and heavy commercial vehicle class, gained 1.6 percent to hit a 52-week high of Rs 174.60 after receiving a major defence order.

At 12:30 p.m., Ashok Leyland Ltd shares were trading at Rs 173.50 per share, up 1.02 percent, after the company received a Rs 800 crore defence order.

As per Company’s BSE filing, Ashok Leyland has received a significant order from the Indian army in the defence sector for the procurement of Field Artillery Tractors (FAT 4×4) and Gun Towing Vehicles (GTV 6×6) for Rs 800 Crores.

In the past year, the Ashok Leyland shares have gained 19.29 percent from a price of Rs 145.70 per share, and in the previous three months, the stock has gained 28.91 percent from a price of Rs 134.75.

Ashok Leyland Ltd is a manufacturer of medium and heavy commercial vehicles. It is one of the most fully-integrated manufacturing companies, with a presence in 50 countries.

In the next three years, Ashok Leyland expects its defence industry income to increase from Rs 400 crore to Rs 1,100 crore.In the medium term, Ashok Leyland intends to increase its domestic market share from 32 percent to 35 percent. It also intends to increase its LCV market share to 25 percent from 19 percent.

As per company’s financials,Operating revenue climbed by 33 percent to Rs 13,202 crore in Q4FY23 compared to the same quarter the previous year, Likewise, net profit increased 412 percent to Rs 794 crore.

Revenue increased by 59 percent year on year, from Rs 26,237 crore in FY 21-22 to Rs 41,672 crore in FY 22-23. Net profit climbed by 562 percent within the same time period, from a loss of Rs 292 crore to a profit of Rs 1,350 crore. 

According to the shareholding pattern for the quarter ending June 2023, promoters own 51.53 percent of the company, while Foreign institutional investors own 14.85 percent and domestic institutional investors own 22.22 percent.

Written by Omkar Chitnis

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