It has been a remarkable year for Ashok Leyland shares. The auto stock has surged almost 56% year-to-date, defying stock market volatility. In intraday trade on Thursday, December 18, Ashok Leyland share price hit its fresh 52-week high of ₹171.75. The stock hit a 52-week low of ₹95.20 on April 7 this year. Clearly, it clocked most of its gains this year after that. On a monthly scale, the stock is already 8% up in December after an impressive 12% jump in November. On the other hand, equity benchmark Sensex is down 1.20% for December and looks on course to snap its three-month winning streak.
Why is Ashok Leyland share price rising?
Solid earnings, GST cuts, and a healthy monsoon have been the main triggers behind the rise in stock prices this year.
“Ashok Leyland’s strong Q2 FY26 performance reinforces its long-term investment appeal, supported by a combination of cyclical recovery, structural competitiveness, and improving profitability,” Seema Srivastava, Senior Research Analyst at SMC Global Securities, explained.
In Q2FY26, India’s second-largest commercial vehicle maker beat estimates with 9% year-on-year revenue growth to ₹9,590 crore, driven by 8% volume growth and better realisations. EBITDA jumped 14.3% year-on-year, and EBITDA margin improved from 11.6% in Q2FY25 to 12.1% in Q2FY26, driven by better mix and sustained cost controls.
“Sustained double-digit EBITDA for eleven consecutive quarters reflects disciplined cost control, product premiumisation, and efficiency gains,” Srivastava underscored.
Srivastava added that the company’s volume growth across both MHCV and LCV segments, coupled with over 30% domestic MHCV market share and leadership in buses, highlights Ashok Leyland’s strong competitive positioning.
Robust export growth (45% YoY) and diversification into defence, power solutions, aftermarket, and electric mobility via Switch Mobility provide additional long-term growth levers beyond the domestic CV cycle, said Srivastava.
Moreover, Srivastava pointed out that the GST 2.0 regime remains a key supportive, as uniform taxation has reduced logistics inefficiencies, encouraged fleet replacement, and improved compliance. This has structurally benefited organised CV manufacturers like Ashok Leyland.
Sneha Poddar, VP of research at wealth management, Motilal Oswal Financial Services, has a similar view.
“Ashok Leyland’s over 50% rally has been driven by a strong upcycle in commercial vehicle demand and sustained volume growth across MHCV and LCV segments. Improved pricing discipline, a favourable product mix and operating leverage have supported steady margin expansion,” said Poddar.
Is Ashok Leyland a stock to buy at this juncture?
The stock has seen sharp gains this year, which can potentially limit its upside even though the company’s growth trajectory appears strong.
“LCV demand is rebounding, with an MHCV recovery likely to follow amid improving consumption trends and GST-driven tailwinds. As per Motilal Oswal research, the stock has already achieved our target price of ₹165; while the long-term outlook remains structurally positive, near-term upside appears limited,” said Poddar.
Srivastava also said that while the stock’s 50%+ rally reflects optimism around demand recovery and margin improvement, long-term upside remains linked to sustained infrastructure spending, export scaling, EV execution, and achieving mid-teen EBITDA margins.
Key risks, according to Srivastava, include cyclical downturns, commodity cost volatility, and competitive intensity, but overall, the company remains well positioned for durable long-term growth.
Technical experts suggest buying the stock after some correction, as they believe a steep rise in the stock could trigger some profit booking.
Jigar S. Patel, Senior Manager of Equity Technical Research at Anand Rathi Share and Stock Brokers, noted that Ashok Leyland is currently trading well above its 20- and 50-day DEMA, indicating a sharp deviation from its short-term mean.
Patel said while the overall trend remains positive, such stretched price action often increases the probability of a mean reversion or time-wise consolidation.
“Historically, stocks tend to revisit key moving averages after an extended up move, especially when momentum starts cooling off. Moreover, the stock has already delivered a strong rally of nearly 50% in the current year, which suggests that a large part of the upside may already be priced in,” said Patel.
“At these elevated levels, risk–reward for fresh long positions appears unfavourable. Hence, traders are advised to trail stop-losses on existing positions to protect profits and avoid initiating fresh buy positions until the stock offers a healthier pullback or consolidation near key support levels,” Patel said.
Pravesh Gour, Senior Technical Analyst at Swastika Investmart, highlighted that Ashok Leyland’s weekly chart continues to reflect a strong and well-defined long-term uptrend, even after the stock has surged more than 50% this year.
The stock is comfortably trading above all key moving averages, while the momentum indicator RSI (relative strength index) is also positively poised. MACD (moving average convergence divergence) is supporting the current strength. Momentum is still expanding, and there are no immediate signs of trend reversal. Together, these indicators point toward continuation rather than distribution, said Gour.
“In terms of levels, the ₹170–175 zone acts as a near-term psychological resistance. If it sustains above these levels, then ₹200 may be the next level. On the downside, strong support is placed around ₹150–155, at the 20-SMA moving average. A deeper support lies near ₹135, around the 50-SMA moving average, and this level is critical for maintaining the long-term bullish structure,” said Gour.
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Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.
