Ashok Leyland plans to expand LCV business, international operations

Ashok Leyland is one of the leading suppliers of logistics vehicles to the Indian Army

Hinduja Group flagship company Ashok Leyland is gearing up to expand its light commercial vehicle business, international operations and defence mobility segment, according to company Chairman Dheeraj G Hinduja.

For the electric vehicle (EV) segment, Ashok Leyland is also looking to tap the proven success of its Optare bus range in the United Kingdom, for other locations as well.

Addressing shareholders in the company’s Annual Report 2017-18, Hinduja said there would be a greater focus on cost control, revenue generation and return on capital employed (ROCE) going forward.

“In the years to follow, to sustain the growth momentum and take a great leap forward, your company is gearing to set globally bench-marked standards in reliability and after-market support,” he said.(Ashok leyland share price)

There will be added thrust on cost control, cash generation and ROCE, he added.

“Furthermore, ambitious plans will be rolled out soon to grow the LCV business, international operations and defence mobility even further,” Hinduja said.

The company, which sells LCVs like Dost and Partner in the country, also has a wide presence across international markets with footprint in more than 50 countries.

Ashok Leyland is one of the leading suppliers of logistics vehicles to the Indian Army. Its range of products include rapid intervention vehicles, field artillery tractors, light recovery vehicles, water bowsers, truck fire fighters and fuel dispensers.

On EVs, Hinduja said the company plans to leverage on the proven success of its Optare bus range in both developed and emerging markets.

“Your company will leverage on the proven success of the Optare range in the UK to position integrated offerings that straddle developed and emerging markets,” Hinduja said.

Bullish on company’s growth prospects, he said: “Having performed well in the recent years in the highs and lows of this business, I believe your company is at a striking distance from being among the global majors in the commercial vehicle field with attributes of operational efficiency, cost control, quality and reliability and product innovation.”

The Chennai-based company reported record sale of 1,74,873 units in 2017-18, its highest ever dispatch in a financial year.

“It is remarkable that the largest volume growth in the domestic truck sales is from the northern region outpacing our traditional southern stronghold where we continue to be market leaders,” Hinduja said.

The company achieved revenue of Rs 26,248 crore and a record profit of Rs 1,563 crore during the last fiscal.

Article source: BS

BS-III deals a blow to automakers sitting on inventory worth Rs 7,000 cr

Second body blow after diesel ban on engines of 2,000 cc and above in NCR

 

The decision leaves automobile makers, primarily Tata Motors, Ashok Leyland and Hero, saddled with a large inventory of BS-III vehicles estimated to be worth Rs 6,000-7,000 crore at the end of the month. Companies were seeking time beyond April 1 to dispose of the existing stock. They now will have to offer steep discounts, ship products to BS-III export markets or invest to upgrade their products to BS-IV. 

This is the second major blow for the industry from the apex court in the past 15 months. In December 2015, the court had imposed a ban on sales of diesel vehicles with an engine of 2,000 cc and above in the National Capital Region. The ban, which primarily impacted Toyota and Mercedes, was lifted in August last year. Wednesday’s order also impacts others like SML Isuzu, VECV and Honda Motorcycle and Scooter India.

Wednesday’s order was passed by a division Bench consisting of Justice Madan Lokur and Justice Deepak Gupta after a hearing over several days. 

At the end of the month, companies, along with their dealers, might be left with an unsold inventory of 500,000-600,000 BS-III vehicles, mostly two-wheelers and commercial vehicles. The government, which had brought out the notification on BS-IV, had told the court that sales could continue after March 31. The notification had stated that manufacturers should comply with BS-IV norms from April 1, 2017, but was silent on the fate of vehicles manufactured before March 31 as far as sales and registration were concerned.

Bajaj may be left with a small number of BS-III two-wheelers at the end of this month. S Ravikumar, president (business development) at the company, told Business Standard that one of the options before the firm was to take back the unsold stocks from dealers and divert them to export markets. “We are the largest exporter of two-wheelers. So, that should not be an issue.” 

However, export is not a simple option for every company. Manufacturers will need to suitably modify the vehicles to meet the local regulatory requirements in export markets. Over the next three days, dealers are expected to dole out heavy discounts to clear as much inventory as possible.| read more...