Hinduja flagship firm Ashok Leyland today posted 22.39 per cent decline in its net profit to Rs 66.94 crore for the quarter ended June 30 due to higher marketing expenses and power costs.
The company had a net profit of Rs 86.25 crore in the same period last year,Ashok Leyland said in a statement.
The net income during the first quarter of this fiscal went up by 19.69 per cent to Rs 3,007.35 crore from Rs 2,512.70 crore in the year-ago period,it added.
Commenting on the result,Ashok Leyland Managing Director Vinod K Dasari said: “Our profits have taken a hit largely because of the robust brand building and marketing initiatives that we kicked off during the quarter,including the signing on of Mahendra Singh Dhoni as our brand ambassador.”
In addition,the company’s performance was also impacted by spiralling power costs,he added.
During the April-June period,the company’s total vehicle sales increased by 42.59 per cent to 27,487 units from 19,277 units in the same period last year.
The sales in the domestic market stood at 17,335 units compared to 16,738 units,while exports went up to 2,904 units from 2,539 units.
“Even while the total industry volume in India dipped by 12 per cent,we were able to increase our market share by 3.8 per cent. Our LCV ‘Dost’ did very well,achieving 21 per cent market share in the first nine months of sales,” Dasari said.
The total expenses in the last quarter rose by 21.39 per cent to Rs 2,855.90 crore from Rs 2,352.74 crore in the first quarter of last fiscal,the company said.
During the quarter,the company’s employee costs were higher at Rs 267.86 crore against Rs 249.74 crore in the same quarter last fiscal.
Other Expenses rose to Rs 310.12 crore from Rs 206.75 crore,while depreciation went up to Rs 89.25 crore from Rs 84.66 crore.
Reacting to the numbers,shares of Ashok Leyland closed 2.10 per cent lower at Rs 23.30 apiece on the BSE.
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