Ashok Leyland shares slip 6% post Q2 earnings; brokerage maintains 'buy'

Shares of Ashok Leyland sank over 6 per cent in trade on Thursday after the company reported September quarter results below Street expectations.

The stock ended 5.81 per cent lower after hitting an intraday low of Rs 86.40, down 6.23 per cent on the Bombay Stock Exchange (BSE).

Broking firm Angel Broking said the Second quarter results were below estimates on back of lower than expected topline and higher depreciation charge.

"The EBIDTA at Rs 594 crore was lower than our estimates of Rs 668 crore. Further, higher depreciation expenses at Rs 113 crore also impacted profitability. Net Profit at Rs 287 crore was below our expectations of Rs 355 crore," said brokerage.

However, the broking firm maintains 'buy' on the stock with a target price of Rs 111.  

Hinduja group flagship firm Ashok Leyland on Thursday reported over two-fold rise in net profit at Rs 287 crore for the second quarter ended September 30, 2015.

The Chennai-based company had posted a net profit of Rs 121 crore during the same period of previous fiscal.

Net sales of the company rose to Rs 4,878.81 crore during the second quarter, as against Rs 3,150.36 crore during the same period of previous fiscal, Ashok Leyland said in a filing to the BSE.