Shares of Ashok Leyland slipped to their 18-month low of Rs 95.95 apiece, dipping 2 per cent on the BSE, and extending their 4 per cent fall in the past two days after recording weak December sales numbers. The stock of commercial vehicles (CV) manufacturer was trading at its lowest level since July 3, 2017.
Ashok Leyland for the second time in the calendar year reported a dismal set of numbers by reporting a de-growth of 20 per cent in its monthly sales of 15,493 units on a yearly basis. This de-growth was mainly on account of the higher base.
The medium and heavy commercial vehicle (M&HCV) segment reported 29 per cent year-on-year declined in sales at 11,295 units in December. Despite the dismal set of numbers, light commercial vehicles (LCV) segment manage to report 27 per cent growth on a yearly basis.
“With the uncertainty regarding the axle norm changes behind us and strong overall demand drivers for the CV sector like increased government focus on infrastructure spend, pre-buying ahead of BS VI implementation and scrappage policy (expected to come in FY21) intact, we remain positive on the overall CV sector growth ahead,” analyst at Prabhudas Lilladher said in sector update.
However, given the higher base H2FY19 onwards as well as the tight credit situation in the segment, H2FY19 growth could remain muted, it added.
In the past eight months, Ashok Leyland has underperformed the market by falling 41 per cent as compared to a 1.5 per cent rise in the S&P BSE Sensex. It had hit an all-time high of Rs 168 on May 8, 2018.
At 10:40 am; the stock was trading 1.7 per cent lower at Rs 96.45 on the BSE, as compared to 0.17 per cent decline in the benchmark index. A combined 9.83 million equity shares changed hands on the counter on the BSE and NSE so far.