Morgan Stanley hiked target price for Ashok Leyland Ltd. from Rs 284 to Rs 288, on its stronger net cash position.
The brokerage has cut its Medium and Heavy Commercial Vehicles volume estimates by 2% on account of slower demand in fiscal 2026. On the upside, it has increased its export volume estimates for Ashok Leyland "as the company continues to do well on that front". Volume estimates for the firm remain largely unchanged, Morgan Stanley said.
Considering lower realisations in fiscal 2025, the brokerage has lowered its fiscal 2026 and 2027 average selling price estimates accordingly. "The impact of AC cabin regulations and higher steel costs drive cuts of 20bps and 10bps to our Ebitda margin estimates for F26 and F27, respectively. Lower-than-expected depreciation and higher other income keeps our EPS estimates for F26 and F27 largely unchanged," Morgan Stanley added.
On June 3, Ashok Leyland won an order from the Tamil Nadu government to supply hundreds of diesel buses by the end of the year.
The order, won by way of a normal tender process, is for the supply of 543 diesel chassis and fully built buses to Tamil Nadu Transport Corporation between June and December 2025, according to an exchange filing on Tuesday. The deal is valued at Rs 183.8 crore and doesn't qualify as a related-party transaction.
The company had announced its fourth quarter results on May 26, largely beating most analysts' expectations primarily driven by strong gross margin expansion and operational efficiency.
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