The Hinduja Group flagship commercial vehicle maker Ashok Leyland announced its December quarter results on Wednesday in market hours, and the results were more or less in line with the expectations of the Street, continuing its recently good profitability momentum.
The consolidated net profit registered by the company in the quarter was 796 crore, an increase of 4.5 per cent compared to a year ago.
The increase in profits was, however, partly dragged down by a one time charge of 308 crore associated with the adoption of the new labour code, increased costs of raw materials.
The total quarterly costs increased sharply at 20.1 per cent mainly attributed to rise of 19.2 per cent in the input costs. In spite of the pressure, the company was able to increase margins owing to operating leverage and better volumes.
The operations under revenue increased 22 per cent year on year to 11,534 crore. EBITDA has increased 27 per cent to 1,535 crore against 1,211 crore in the corresponding quarter of previous year.
Consequently, EBITDA margins grew by 500 basis points to 13.3 per cent as the company has recorded double digit margins in the twelfth quarter in a row.
The growth of the volume was high in categories. Wholesale of medium and heavy commercial vehicles were up 23 per cent per annum to 32,929 units.
The light commercial vehicle volumes increased at an even higher rate with 30 per cent of increase to 20,518 units. The exports were also performing positively as they went up by 20 per cent to 4,965 units showing that the demand is also broad based both in the domestic and overseas markets.
In commenting on the performance, the Executive Chairman of the company, Dheeraj Hinduja, said that market conditions had still remained favourable and that it would continue to maintain the momentum in the medium term in MHCV, LCV and defence businesses.
He said that the steady increase in volumes and profitability indicates competitiveness of the company product line and its orientation towards value delivery supported by a high level of customer interaction.
The company has been rewarded by investors in terms of performance during the last one year. The stock has been in the protracted upward trend since March 2025 and has spent the next eight out of the final ten months in the green, raking in a 93 per cent gain over the same time frame.
To calendar year 2025, the shares surged 62.5 per cent, the sixth straight year of gains, and the biggest annual increase in ten years.
Ashok Leyland stocks in the Wednesday trade have reached a new all time high of 215.2 as the year-to-year gain has soared to more than 15 per cent.
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As costs problems persist in the company, analysts believe the performance of the margin will require sustained demand, pricing discipline and operational efficiencies as the company will continue to perform in the next quarters.
Disclosure: Investors should seek the service of professional financial analysts before investing.
