Thursday, September 04, 2014

Ashok Leyland Ltd: Sell
Ashok Leyland Ltd (Rs.37.35) has a whopping market cap of Rs.10,643.58 Cr, which is near the total FY14 earnings of Rs.10,009.95 Cr. Besides it is already trading at 2.38 times its book value of Rs.15.69. The dividend yield at the current price is only 1.60%, which is very poor. 

In fact the whole of the auto sector seems to be overvalued, especially the large cap ones (Tata Motor Ltd's P/E is blinding 6,410.63 while the industry P/E is 248.08).......and therefore a DOTCOM-like CRASH can happen at any time. 
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