ASHOKLEY

Fundamental View- Ashok Leyland Ltd., India’s second-largest commercial vehicle manufacturer, reported robust FY 2023–24 consolidated revenue of ₹45,791 cr and net profit of ₹2,696 cr, up significantly from ₹1,362 cr a year ago. The company has achieved strong profitability, with an operating margin of 17.3%, ROE at 30–31%, and ROCE around 16%. Its balance sheet shows high leverage (debt-to-equity 3×–4×) but manageable interest coverage (2.2–2.4×) and a current ratio near 1.1×. The market values the stock at P/E 20× and P/B 5.6×, with EV/EBITDA ~11.6×. Recent growth drivers include a 36% rise in annual EPS to ₹11.25/share and a 33% jump in Q3FY25 net profit, backed by strong export volumes and expansion into electric/hybrid vehicle segments. Given its solid margins, turnaround profitability, and strategic focus on new-energy vehicles, Ashok Leyland is fundamentally sound—but the high debt level and premium valuation warrant cautious positioning. Technical View- As seen on the daily chart of Ashok Leyland, the stock is trading in a strong uptrend and is consistently holding above its 14, 55, and 200-day EMAs. The stock has shown a good rally recently and is currently sustaining above the 250 level. The Parabolic SAR dots are placed below the price, indicating a positive trend. The MACD indicator is showing positive divergence, with the MACD line trading above the signal line, suggesting buying strength. The RSI is also around 66, reflecting bullish momentum, but it is still not in the overbought zone, leaving room for further upside. Looking at the overall structure, the stock can be considered for buying on dips with a stop-loss of 240, and on the upside, it may potentially test levels of 260-265. Warning- ***** ***** *****