Buy Ashok Leyland Ltd for the Target Rs. 166 by Motilal Oswal Financial Services Ltd

* After a subdued 1Q, CV volumes saw a healthy pickup in 2Q, up 7.7% YoY. While MHCV sales grew 9%, LCV sales rose 5.5%. Export mix has sharply improved, up 45% YoY.
* Input cost to largely remain stable QoQ, unlike fears of an increase. Staff cost may rise QoQ due to annual increments.
* Led by improved mix and volumes, EBITDA margin to rise 70bp QoQ (+20bp YoY) to 11.8%. PAT to grow 7% YoY.
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