Ashok Leyland share price has skyrocketed over 13 per cent in the intraday trade session on Thursday, though its first quarter results were very weak. The Hinduja Group flagship company reported a net loss of Rs 389 crore in the June quarter on massive sales decline on weak macroeconomic reasons coupled with Coronavirus lockdown. According to stock market experts, this rise in Ashok Leyland shares is in hope of the Government of India (GoI) making some announcement in regard to the ‘Scrappage Policy’ that has been due for a long. They said that the leading commercial vehicle manufacturer company stock has made a breakout on charts and it may hit Rs 75 per share mark soon.
Speaking on the reason for the rise in Ashok Leyland share price, Avinash Gorakshkar, Head of Research at Profitmart Securities said, “Ashok Leyland Q1 FY21 results are quite weak and the fundamentals of the company are expected to remain weak due to the COVID-19 impact. However, this rise can be attributed to the GoI making some announcement in the Scrappage Policy in a day or two. The market is expecting that once the scrappage policy is announced, Ashok Leyland being the largest commercial vehicle manufacturer in India, will be one of the major beneficiaries of this announcement by the GoI.”
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On Ashok Leyland share price outlook, Simi Bhaumik, a SEBI registered technical equity analyst said, “Ashok Leyland shares have recently made a breakout after sustaining above Rs 56 to Rs 57 levels. It may soon hit Rs 65 to Rs 68 levels and once it breaks this level, we can expect it to hit Rs 72 to Rs 75 as well.”
On the time-horizon, Bhaumik said, “Ashok Leyland shares area expected to showcase the above mentioned targets in next one to two months.”