Ashok Leyland Stock Ignites: Analyst Slams Buy Button with ₹178 Target on EV Boom & Margin Surge!

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Updated on 13 Nov 2025, 12:06 pm

Analysts have reiterated a Buy rating for Ashok Leyland, setting a target price of ₹178 per share. The positive outlook is underpinned by anticipated margin expansion, fueled by robust growth in non-Commercial Vehicle (CV) segments, ongoing cost control measures, and the introduction of more powerful, higher-margin tipper vehicles.

In the electric vehicle space, the company's entity SWITCH India reported both EBITDA and PAT positive results in the first half of FY26, having delivered 600 e-Buses and 600 e-LCVs. With an existing order book of 1,650 e-Buses and a clear goal to achieve Free Cash Flow (FCF) positive status by FY27, SWITCH India's performance is a key growth driver. The recent launch of the 'Saathi' model in the 2-4 tonne segment is also showing strong traction by offering a superior value proposition, particularly appealing to the sub-2-tonne replacement market.

Furthermore, Ashok Leyland's renewed participation in e-Bus tenders signals a strategic push into this growing segment. The valuation multiple has been slightly adjusted to 19 times September 2027 Earnings Per Share (EPS), up from 18 times, with the value of Hinduja Leyland Finance also factored in at ₹24. Despite these positive developments, analysts remain watchful of the higher pledging by the promoter group.

Impact: This news significantly impacts Ashok Leyland's stock performance and investor sentiment. The positive outlook, coupled with the Buy rating and specific target price, is likely to attract investors. The success of its electric mobility division and new product launches indicates strong future growth potential, potentially boosting market share and profitability. The concern about promoter pledging, however, introduces a note of caution. Overall, the outlook is bullish, with potential for market value establishment and value unlocking. Rating: 8/10

Terms: • CV segments: Refers to Commercial Vehicle segments, which include trucks and buses. • EBITDA: Earnings Before Interest, Taxes, Depreciation, and Amortization. It is a measure of a company's operating performance, excluding non-operating expenses and income. • PAT: Profit After Tax. This is the net profit remaining after all expenses, including taxes, have been deducted. • FCF: Free Cash Flow. It represents the cash a company generates after accounting for cash outflows to support operations and capital expenditures. • EPS: Earnings Per Share. It indicates how much profit a company generates for each share of its stock outstanding. • Valuation multiple: A ratio used to gauge the value of a company or its stock relative to its earnings, sales, or book value. For example, a P/E multiple compares the stock price to its earnings per share. • Promoter Group: The founders and initial investors of a company who hold a significant stake and often have substantial influence over its management and strategic decisions.