Ashok Leyland will continue to maintain its growth trajectory despite the competition, and is on track to derisk its operations from the cyclical nature of the medium & heavy commercial vehicle (M&HCV) business, said Dheeraj Hinduja, Chairman, Ashok Leyand.

“Compared to the competition, Ashok Leyland has been growing the fastest. The product development focus along with the extension of the network has really been the key reason for its marketshare increase. Over the last four-five years, our marketshare has grown to 32 per cent from 24 per cent,” he said addressing the company's 69th Annual General Meeting.

Non-core businesses such as defence and power solutions are seeing good growth, and thus, increasing the company’s ability to handle business cycles.

Profitable subsidiaries

“I am glad to tell you that barring two companies, other subsidiaries have turned around and are making profits,” he stated.

The future for Hinduja Leyland Finance, which is planning an IPO this year, is bright, he said. The objective of raising the shareholding in the finance arm to 62 per cent from 57 per cent is to retain 51 per cent control of the company post-IPO in order to consolidate the operations and grow.

Hinduja Foundries has turned around well in the last 15-16 months. It is now showing cash profit and the production is far more efficient with a growing client base, Hinduja said.

Financial performance

Ashok Leyland has more than tripled its profit after tax to ₹370 crore for the quarter ended June 30, 2018, compared with ₹111 crore in the year-ago quarter. The Q1 performance comes on the back of a strong growth in topline on account of robust truck sales.

The company’s revenue grew by 47 per cent to ₹6,250 crore against ₹4,258 crore in the Q1 of the previous fiscal. Its EBITDA margin remained robust at 10.4 per cent (7.2 per cent in the year-ago period) during the Q1 of this fiscal.

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