Q1 2027 Ashok Leyland Limited Earnings Call Transcript
Key Points
- Record Q1 performance with all-time high CV volumes, revenue, profit, and cash surplus, demonstrating operational resilience.
- Strong domestic growth with MHCV truck volumes up 15% YoY and LCV offtake up 21% YoY, achieving the highest-ever Q1 LCV volume.
- Robust non-CV business growth, with aftermarket revenue up 12.7%, Power Solutions up 51%, and defense revenue up 64% YoY.
- Successful mitigation of commodity cost pressures through price increases (1.2-1.25% in Q1), cost savings, and inventory management, keeping material costs in line with Q4.
- Strong cash position with net cash of INR2,252 crore, up INR1,431 crore YoY, and continued investment in future technologies and EV subsidiaries.
- Positive industry outlook with strong demand momentum in June and July (MHCV growth >20%), driven by replacement demand and GST optimization, supporting high single-digit growth for the year.
- EBITDA margin declined 100 basis points YoY to 10.1% due to rising material costs and supply chain disruptions.
- Exports volume fell 18% YoY due to geopolitical issues impacting the GCC market, with logistical challenges at the UAE plant.
- Bus volumes declined, particularly in the STU segment, due to the deliberate decision to avoid unprofitable orders, leading to temporary market share loss.
- Commodity price pressures are expected to persist in Q2, with potential further margin impact, though mitigation efforts are underway.
- Q1 performance was partly supported by inventory benefits (using lower-cost opening stock), which may not be repeatable in subsequent quarters.
- The company faces a high base in H2 FY27, which could moderate industry growth rates, requiring conservative outlook.
Ladies and gentlemen, good day, and welcome to the Ashok Leyland Q1 FY27 earnings conference call. (Operator Instructions) Please note that this conference is being recorded.
I now hand the conference over to Mr. Joseph George from IIFL Capital. Thank you, and over to you Mr. Joseph.
Thank you. Good evening, everyone. On behalf of IIFL Capital, I welcome you all to the 1Q FY27 results conference call of Ashok Leyland. I also welcome the senior management of Ashok Leyland. Mr. Shenu Agarwal, Managing Director and CEO; Mr. K.M. Balaji, Wholetime Director and CFO; and the Investor Relations team.
Now I will hand over the call to Mr. Shenu Agarwal. Over to you, sir.
Good evening, everyone, and thank you for your trust in Ashok Leyland as always. As we all have witnessed, Q1 this year was marked by various geopolitical uncertainties translating into widespread
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