Ashok Leyland has ended this financial year FY17 strongly, beating Bloomberg analyst estimates of revenue growth (they estimated 9.8%) to log 11% revenue growth for the fourth quarter. Net profit stood at Rs. 476 crore, also beating estimates. The company's share price is up today post results.
Analysts had expected ALL to show weaker numbers after the Supreme Court directive than banned BS III vehicles from April 1. The auto industry had made a last minute scramble after the court ruling to sell old stocks of these vehicles in the final days of March, and many had expected Ashok Leyland to take a hit in its margins after selling these at deep discounts.
However, the company's profit margins have held for the quarter. The firm may however, have to address rising competition by Bharat Benz trucks in the coming quarters, which are priced lower than Ashok Leyland's offerings after the introduction of BS IV norms.