Ashok Leyland Ltd.

Income & Expenditure Summary : Mar 2013 - Mar 2017 :

Non-Annualised : Rs. Crore

Mar-13 Mar-14 Mar-15 Mar-16

12 mths 12 mths 12 mths 12 mths
IGAAP IGAAP IGAAP INDAS

- 35.9% 37.7%
Total income 14,344.88 11,596.48 15,332.77 20,585.23
Sales 13,947.98 10,918.31 14,840.19 20,428.77
Industrial sales 13,032.81 9,878.70 13,850.78 19,286.64
Income from non-financial services 915.17 1,039.61 989.41 1,142.13
Income from financial services 375.35 440.42 62.02 99.12
Interest income 33.24 17.34 26.24 44.5
Dividends 7.56 4.7 2.78 3.98
Income from treasury operations 334.55 418.38 33 50.64
Other income 17.38 35.09 59.82 56.48
Prior period and extraordinary income 4.17 202.66 370.74 0.86

Change in stock -279.36 -461.23 78.73 478.73

Total expenses 13,631.81 11,105.87 15,076.69 20,674.36

0.95 0.94 0.91
Operating expenses 12,790.28 10,379.80 13,889.92 18,633.80
Raw materials, stores & spares 7,613.70 5,960.32 8,687.77 12,193.16
Purchase of finished goods 1,311.75 1,269.03 1,391.19 1,531.23
Packaging and packing expenses
Power, fuel & water charges 86 61.04 82.49 115.96
Compensation to employees 1,075.52 1,046.42 1,184.00 1,385.06
Indirect taxes 819.72 587.58 976.61 1,159.85

Royalties, technical know-how fees, etc

Rent & lease rent 28.06 26.31 17.91 21.44
Repairs & maintenance 280.91 250.26 268.95 304.38
Insurance premium paid 6.66 6.48 5.21 7.6
Outsourced manufacturing jobs
Outsourced professional jobs 1.46 1.62 2.15 2.52
Non-executive directors' fees 2.14 0.2 2.8 9.03
Selling & distribution expenses 1,516.82 1,112.46 1,229.39 1,835.46
Travel expenses
Communications expenses
Printing & stationery expenses
Miscellaneous expenditure 245.03 192.08 241.05 331.04
Other operational exp of industrial ent
Other operational exp of non-fin services ent
Share of loss in other enterprises
Financial services expenses 406.83 434.08 649.89 815.11
Fee based financial services expenses
Fund based financial services expenses 406.83 434.08 649.89 815.11
Non-cash charges 396.98 410.14 426 556.23
Depreciation 381.94 376.48 414.73 487.9
Amortisation 15.04 28.41 10.78
Write-offs 5.25 0.49
Provisions 68.33

Prior period and extraordinary expenses 0.72 2.45 3.49 232.28

Provision for direct tax 37 -120.6 107.39 436.94

Profit after tax 433.71 29.38 334.81 389.6

 2.3% 1.9%
Addendum Information
Total income net of P&E 14,340.71 11,393.82 14,962.03 20,584.37
Net sales 13,128.26 10,330.73 13,863.58 19,268.92
Cost of goods sold 10,751.15 9,127.36 11,630.64 15,227.60
Cost of sales 13,646.93 11,351.31 14,420.95 18,893.18
Cost of sales per day 37.39 31.1 39.51 51.76

EBIDTA 1,249.63 695.40 1,282.93 1,870.67

EBITDA margin 9.0% 6.4% 8.6% 9.2%
EBIT
 Mar-17 Mar-18 Mar-19 Mar-20
12 mths
INDAS

6.7% 22.6% 17% 20%

22,281.01
21,790.71 26719 31261.23 37513.48
20,674.10
1,116.61
412.6
67.81
1.16
343.63
69.67
8.03

689.48

21,747.41
0.93 0.86 87% 88%
20,285.51 22,920.00 27197.27 33011.86
13,185.18
1,607.64

168.73
1,530.94
1,345.90
0.06

21.38
348.91
12.58

3.32
11.74
2,002.53

388.86

284.91

284.91
1,069.98
517.89 554.6 472.8 510.6

552.09

30%
107.01 668

1,223.08 1563 1656.845 1988.214

 5.6% 5.8% 5.3% 5.3%

22,272.98
20,444.81
16,335.52
20,436.04
55.99

2,917.96 3,211.00 3,595.04 4,689.18

13.4% 12.02% 11.5% 12.5%
2,656.40 3,122.27 4,178.59
DCF Valuation of Ashok Leyland
2018 2019 2020
EBIT 2,656.4 3,122.3 4,178.6
Tax (assumed 30%) 796.9 936.7 1,253.6
Depre 554.6 472.8 510.6
Capex 454.2 441.8 540.3
NWC -5,474.1 -5,314.4 -6,377.3
Inc in NWC -2,853.2 159.7 -1,062.9
Operating FCF (EBIT-TAX+DEPR-CAPEX-change in NWC) 4,813.1 2,056.8 3,958.2
Non-operating FCF
FCFF 2,056.8 3,958.2

WACC 14.20% Wt.

Ke 15.00% 80%
Kd 11% 20%
g 5%

PV of CFs 4836.1
Terminal Val 43023.7
PV of Terminal 32989.5
Firm Value 37825.6
Debt 1,146.33
Cash 1,004.41
Value of Equity 37683.67
N 293.55
Value/ Share 128.37
CMP (mar2018) 145
Difference 13%
Ashok Leyland Ltd.

Balance Sheet Summary : Mar 2013 - Mar 2017 : Non-

Annualised : Rs. Crore

Mar-13 Mar-14 Mar-15 Mar-16 Mar-17

12 mths 12 mths 12 mths 12 mths 12 mths
IGAAP IGAAP IGAAP INDAS INDAS
-
Total liabilities 13,157.49 13,031.04 13,418.03 13,206.12 14,462.08

Total Capital 266.07 266.07 284.59 284.59 284.59

Paid up equity capital 266.07 266.07 284.59 284.59 284.59
Paid up preference capital

Share appln money & suspense account 8.07

Reserves and funds 4,189.04 4,181.82 4,834.12 5,122.56 5,833.41

Free reserves 2,048.28 2,095.11 2,079.54 3,511.76 3,546.38
General reserves 943.41 943.41 943.41 943.22 952.11
Balance as per profit & loss account 1,104.87 1,151.70 1,136.13 2,568.54 2,594.27
Specific reserves 844.11 912.78 1,732.77 1,610.80 2,287.03
Security premium reserves (net of deductions) 754.77 753.6 1,386.97 1,386.97 1,896.46
Capital reserves (incl grants and subsidies) 0.9 88.83 88.83 87.93 263.86
Capital redemption reserves 3.33
Debenture and bond redemption reserves 90 72.5 268.75 152.5 100

Long term borrowings excl current portion 2,737.84 3,296.50 2,566.34 1,821.04 1,146.33
Long term borrowings incl current portion
From banks 600 833.33 383.33
From financial institutions
Syndicated across banks & institutions
Debentures and bonds 960 1,190.00 1,075.00
Loans from promoters, directors & shareholders
Less: current portion of long term borrowings 850.61 806.41 758.39

Deferred tax liability 587.74 624.17 611.06 752.99 741.05

Other long term liabilities 1.78 2.37 2.06 34.59 39.26
Long term provisions 78.52 67.87 96.92 291.68 179.78
24% 29%
Current liabilities & provisions 5,296.50 4,592.24 5,022.94 4,898.67 6,229.59
Short term borrowings 766.99 587.41 25 25 199.31
Short term trade payables and acceptances 2,654.40 2,360.94 2,854.13 2,579.72 3,087.35

Total assets 13,157.49 13,031.04 13,418.03 13,206.12 14,462.08

Net fixed assets 5,281.90 5,659.87 5,255.55 4,791.98 4,970.81

Net intangible assets 363.44 437.95 373.08 338.28 314.72
Land and buildings 2,349.57 2,303.54 2,153.51 1,748.60 1,873.20
Plant, machinery, computers & electrical assets 2,398.91 2,779.30 2,619.12 2,594.40 2,640.22

Capital work-in-progress 688.93 181.53 120.15 75.86 205.87

Net pre-operative exp pending allocation
-5% 6% 6%
Long term investments 2,337.65 2,405.31 2,240.37 1,980.44 2,001.68
Long term investments in group cos 2,055.50 2,221.75 2,281.01 2,339.48 2,207.00
Long term investments in non group cos 321.09 227.23 227.23 198.89 203.32
 Long term loans & advances 499.33 672.75 684.81 1,130.13 1,307.16
Deferred tax assets 60.37 217.4 100.8 30.21 60.53
Other long term assets 12.03 361.79 317.61 8.06 8.05

Current assets and loans & advances 4,277.28 3,532.39 4,698.74 5,189.44 5,907.98
Inventories 1,896.01 1,188.70 1,398.53 1,625.02 2,501.11
Trade & bills receivables 1,419.80 1,304.65 1,248.40 1,259.42 908.27
Cash & bank balance 13.95 11.69 768.38 1,593.14 911.97
Inventories as % of Sales 9.4% 8.0% 11.5%
Receibvables as% of Sales 8.4% 6.2% 4.2%
Short term investments 0 384.38 408.45 877.17
Short term loans & advances 582.92 429.91 467.97 623.62 469.96

Addendum Information
Net fixed assets net of reval 3,985.25 4,485.94 4,233.74 4,791.98 4,970.81
Tangible net worth 2,778.93 2,817.39 3,708.38 5,068.87 5,811.35
Total outside liabilities 9,342.88 9,188.79 8,110.90 7,116.11 7,842.22
11%
GFA 5,278.91 5,857.90
Cumulative Depre 486.93 887.09
Depreciation for the year 400.16
0.000 6.8%

NWC (non-cash) -2,620.90

 Mar-18 Mar-19 Mar-20

31% 29% 29%

8,327.37 9065.757 10878.91
100
4,762.08

4,974.23 4,943.30 4,973.02

3% 6%
3408.1 3612.6
1,709.87 2500.9 3001.1
1,043.42 1250.4 1500.5
1,004.41
6.4% 8% 8%
3.9% 4% 4%

8% 7% 8%
6,312.05 6753.894 7294.205
1,337.82 1,810.59 2,321.19
450.73 472.8 510.6
7.1% 7% 7%

-5,474.08 -5,314.41 -6,377.29