Bonus 1:1, Dividend Rs 6.25, Q4 Strong Yet Ashok Leyland Shares Remain Flat: Buy or Skip?

Ashok Leyland shares traded flat on the stock market today despite the company announcing strong Q4 FY25 results. Along with the earnings, the company also declared a 1:1 bonus issue and a total dividend of Rs.6.25 per share for FY25. Investors are now figuring out whether it's the right time to enter the stock.

Ashok Leyland shares today

Ashok Leyland shares closed today at Rs.239.60, showing little movement with a marginal dip of 0.0042%. Over the past month, the stock has gained 5.34%, and it is up 7.53% year-to-date. While the stock has seen only a muted rise of around 5% over the past year due to volatile trading, its long-term performance has been impressive, delivering a strong return of 464.43% over the past five years.

Ashok Leyland Q4 FY25 Earnings

Ashok Leyland revenue for Q4 FY25 grew by 6% year-on-year to Rs 11,910 crore. However, this was slightly below expectations due to lower-than-expected prices per vehicle. Despite this, the company's operating profit (EBITDA) grew 13% to Rs Rs.1,790 crore, which was mostly in line with estimates.

Take a Poll

As highlighted by the Nuvama Institutional equities report, total sales volumes rose 5% YoY to 59,176 units. While the engine sales grew 9%, and revenue from spare parts increased by 15%. Gross margins improved to 29.4%, helping operating margins expand to 15%. And the net profit grew 30% to ₹1,260 crore, mainly due to better other income and lower taxes.

The broking, Nuvama Institutional Equities, has slightly increased its EBITDA estimates for FY26 and FY27 by 3% and expects profit and EPS to rise 5% each. Despite this, it maintains a 'Reduce' rating on the stock due to a muted growth outlook, with a revised target price of ₹224 up from Rs Rs.211.

Ashok Leyland Announces Bonus Share Issue

Ashok Leyland's Board of Directors has approved the issuance of bonus shares in a 1:1 ratio. This means shareholders will receive one additional equity share for every fully paid-up share they currently hold, with a face value of Rs 1 each. The record date for the bonus has not been announced yet.

Ashok Leyland Declares Interim Dividends for FY25

The company has also declared two interim dividends for the financial year 2024-25. The first interim dividend of Rs. 2 per share was paid in November 2024, while a second interim dividend of Rs. 4.25 per share was declared earlier in May. This brings the total interim dividend payout for FY25 to Rs Rs.6.25 per share, based on a face value of Rs 1.

About Ashok Leyland

Ashok Leyland is one of India's leading commercial vehicle manufacturers and a flagship company of the Hinduja Group. Headquartered in Chennai, it was founded in 1948 and has since grown into the second-largest manufacturer of commercial vehicles in India, the third-largest bus manufacturer in the world, and a top ten truck manufacturer globally.

The company's product portfolio includes trucks, buses, light commercial vehicles (LCVs), and defence vehicles. Ashok Leyland is known for its strong presence in the medium and heavy commercial vehicle (MHCV) segment and has a wide network of service and spare parts centres across India and international markets.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author, nor GoodReturns. The author, nor the brokerage firm nor GoodReturns would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.