Ashok Leyland Shares Surge 9% on GST Rate Cut Proposal; Analysts Bullish

1 min read     Updated on 18 Aug 2025, 12:39 PM
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Riya DeyBy ScanX News Team
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Overview

Ashok Leyland's stock price jumped nearly 9% following the government's proposal to reduce GST rates on various vehicle categories. The stock hit an intraday high of ₹132.90, its largest single-day gain since February 2021. Analysts project up to a 23% potential upside, with UBS, Goldman Sachs, and Citi maintaining 'buy' ratings. The company expects mid-single-digit growth in the medium and heavy commercial vehicle industry and higher growth in light commercial vehicles for FY26. Ashok Leyland plans to invest ₹300 crore in Ohm Mobility over the next 12 months.

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*this image is generated using AI for illustrative purposes only.

Shares of Ashok Leyland , a leading commercial vehicle manufacturer, witnessed a significant uptick of nearly 9% following the Central government's proposal to reduce GST rates on various vehicle categories. The stock's movement comes in the wake of potential tax reforms and positive analyst outlooks.

GST Rate Cut Proposal Boosts Sentiment

The surge in Ashok Leyland's stock price was primarily driven by the government's proposal to reduce GST rates on entry-level two-wheelers, small cars, and hybrid passenger vehicles. This proposal aligns with Prime Minister Narendra Modi's Independence Day announcement regarding a two-tier GST structure, which is expected to be implemented by Diwali.

Stock Performance and Analyst Projections

Ashok Leyland's stock hit an intraday high of ₹132.90, marking its most substantial single-day gain since February 2021. The sharp rise follows the company's recent quarterly results, which have prompted analysts to project up to a 23% potential upside from the previous closing price of ₹121.96.

Analyst Ratings and Target Prices

Several prominent financial institutions have expressed optimism about Ashok Leyland's prospects:

  • UBS maintains a 'buy' rating with a target price of ₹150.00, citing operational discipline and margin outperformance.
  • Goldman Sachs and Citi both rate the stock as 'buy' with target prices of ₹140.00.
  • Jefferies holds its target price at ₹120.00.

Out of 43 analysts covering the stock, 34 have 'buy' ratings, six maintain 'hold' positions, and three recommend 'sell'.

Management Outlook and Future Plans

Ashok Leyland's management has provided insights into their expectations and strategies:

  • The company anticipates mid-single-digit growth in the medium and heavy commercial vehicle industry.
  • Higher growth is expected in the light commercial vehicles segment for FY26.
  • Switch Mobility, a subsidiary, has turned profit before tax positive and is projected to achieve profit after tax positivity by the end of FY26.
  • The company plans to invest ₹300.00 crore in Ohm Mobility over the next 12 months.

Market Implications

The proposed GST rate cuts, if implemented, could potentially boost demand in the automotive sector. For Ashok Leyland, this development, coupled with their strong performance and positive analyst sentiments, suggests a favorable outlook for the company in the near term.

Investors and market watchers will be keenly observing how these potential tax reforms and the company's strategic initiatives translate into financial performance in the coming quarters.

Historical Stock Returns for Ashok Leyland

1 Day5 Days1 Month6 Months1 Year5 Years
-0.14%+11.17%+6.65%+17.53%+2.38%+273.35%
Ashok Leyland
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Ashok Leyland Reports 13% Profit Growth in Q1 with Margin Expansion

1 min read     Updated on 14 Aug 2025, 01:59 PM
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Reviewed by
Riya DeyBy ScanX News Team
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Overview

Ashok Leyland achieved its highest-ever Q1 revenue of Rs 8,724.50 crore, a 1.5% increase year-over-year. The company's EBITDA rose 6% to Rs 969.50 crore, with EBITDA margin improving from 10.6% to 11.1%. Net profit increased by 13% to Rs 593.70 crore, surpassing market estimates. The company reported record CV volumes of 44,238 units and growth in export volumes. Ashok Leyland's shares surged over 3% following the results announcement, settling 1.75% higher at Rs 121.83.

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*this image is generated using AI for illustrative purposes only.

Ashok Leyland , the Indian flagship of the Hinduja Group, has reported exceptional financial results for the first quarter, setting new records in various key metrics.

Record-Breaking Performance

The commercial vehicle manufacturer achieved its highest-ever Q1 revenue of Rs 8,724.50 crore, a 1.5% increase from Rs 8,598.50 crore in the same period last year. The company's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) rose 6% to Rs 969.50 crore from Rs 911.00 crore in the corresponding quarter, marking an improvement in EBITDA margin from 10.6% to 11.1%.

Profit Surge and Market Performance

Ashok Leyland's net profit saw a significant increase of 13% year-on-year, jumping to Rs 593.70 crore from Rs 525.50 crore, surpassing market estimates. Following the results announcement, Ashok Leyland shares surged over 3% during trading, reaching as high as Rs 124.00 on the NSE before settling 1.75% higher at Rs 121.83. The stock has declined 1.03% over the past 12 months but gained 10.70% year-to-date. Trading volume was 7.39 times the 30-day average.

Diverse Business Growth

The company reported strong performances across various segments, including:

  • Record CV volumes of 44,238 units
  • Growth in export volumes
  • Significant contributions from Power Solutions, Aftermarket, and Defence businesses

Electric Mobility Progress

Notably, the company's electric mobility subsidiary, Switch Mobility, has been making progress in the electric vehicle segment.

Management Commentary

The management has expressed satisfaction with the Q1 performance, highlighting the company's effective market execution and cost management. They emphasized efforts to strengthen the company's position in international markets and the defense business.

Financial Position

Ashok Leyland's strong financial results and market performance position it well for continued success in the commercial vehicle market.

Note: All financial figures are in Indian Rupees (INR).

Historical Stock Returns for Ashok Leyland

1 Day5 Days1 Month6 Months1 Year5 Years
-0.14%+11.17%+6.65%+17.53%+2.38%+273.35%
Ashok Leyland
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