Ashok Leyland shares have been trading near record highs following exceptional performance in the December quarter, with the stock gaining 27% since November 12 when the company declared its second-quarter results. The commercial vehicle manufacturer's strong showing has been driven by robust sales growth and improving market conditions.

Strong Q3 FY26 Performance Drives Rally

The company delivered impressive sales volumes across both domestic and export markets during the third quarter of FY26:

The strong performance reflects sustained demand momentum aided by GST rate cuts and improved infrastructure activity. Domestic sales significantly outpaced the overall sector growth of 20.7%, demonstrating the company's competitive positioning.

Capacity Expansion and Strategic Investments

Ashok Leyland is actively ramping up capacity across multiple facilities to capitalize on the upbeat demand environment. The company's expansion plans include several key initiatives:

Manufacturing Capacity Enhancement

The Andhra Pradesh facility ramp-up, combined with the Lucknow plant becoming operational, will significantly boost the annual bus body-building capacity. For light commercial vehicles, the company can scale up capacity through process improvements and minor capital expenditure.

Battery Manufacturing Initiative

Ashok Leyland has announced plans to invest approximately ₹5,000 crore over the next decade to develop and manufacture batteries for automotive and energy storage applications. The company has entered a long-term exclusive partnership with China-based CALB Group to produce batteries in India, marking a significant step toward vertical integration in the electric vehicle ecosystem.

Electric Vehicle Progress

The company's electric vehicle unit, Switch Mobility, is progressing toward profitability. It achieved break-even at the operating profit before depreciation and amortization (EBITDA) level during the first half of FY26, indicating improving operational efficiency in the EV segment.

Export Growth Strategy

For exports, Ashok Leyland aims to increase FY26 sales volume by 20% year-on-year to reach 18,000 units. The company plans to sustain similar growth rates over the next two to three years, targeting 25,000 export units, reflecting its commitment to international market expansion.

Analyst Outlook and Valuation Concerns

Emkay Global Financial Services has revised its estimates upward, raising revenue projections by 3-7% and earnings per share targets by 6-10% for FY27 and FY28, citing the improving growth outlook. However, at Tuesday's closing price of ₹186.00 on the BSE, the stock trades above the brokerage firm's target price of ₹160.00, which may result in near-term profit booking pressure.

The company expects the second half of FY26 to outperform the first half, driven by lower tax rates and improving infrastructure activity, positioning it well for continued growth in the commercial vehicle segment.

Ashok Leyland Ltd. witnessed significant institutional activity with a major block trade executed on the National Stock Exchange (NSE). The transaction represents one of the notable trading activities in the commercial vehicle manufacturer's stock.

Block Trade Details

The block trade involved substantial volume and value, reflecting institutional investor interest in the company's shares.

Market Significance

Block trades are typically executed by institutional investors, mutual funds, or other large market participants. These transactions occur outside regular market hours and involve substantial volumes that might otherwise impact normal trading if executed during regular sessions. The execution price of ₹187.22 per share provides a reference point for the stock's institutional valuation.

Such large-volume transactions often indicate strategic investment decisions by institutional players and can influence the stock's future trading patterns. The significant value of ₹28.08 crores demonstrates the scale of institutional participation in Ashok Leyland's equity.