JPMorgan maintains ‘overweight’ Ashok Leyland; here’s why

JPMorgan has raised its target price on Ashok Leyland to Rs 145 versus Rs 135 per share. They have also raised their EBITDA (earnings before interest, taxes, depreciation, and amortization) estimates as well by about 7-13 percent and forecast that margins will improve too.

JPM has maintained an overweight rating but their key theory here is a bet on cyclical recovery in the commercial vehicle space and Leyland's own market share has definitely recovered.

The Ashok Leyland stock is up 1.9 percent today (April 7) at the time of publishing. In the past five trading sessions, it has risen 8.5 percent while in the last month it has shot up by 28 percent.