Commercial vehicles (CV) major Ashok Leyland, signed a Letter of Intent (LoI) with Israel-based firm Phinergy to secure long-term arrangements for its electric CVs.

Ashok Leyland and Phinergy will work towards the adaptation of unique, competitive, and sustainable solutions for high-energy applications in the commercial vehicles space in order to provide varying energy management solutions to the customers.

Ashok Leyland is India's second largest manufacturer of commercial vehicles and is owned by the Hinduja Group. Headquartered in Chennai, the company is the 4th largest manufacturer of buses and the 12th largest manufacturer of trucks in the world.

Founded in 1948, Ashok Leyland also specialises in spare parts and engines for industrial and marine uses. In the Financial Year 2016, the company sold nearly 1,40,000 vehicles and boasts of a with a market share of 32.1 per cent.

We assume Ashok Leyland at Hold with price target of Rs 130. We expect 10-15% growth in M&HCV industry over FY18-20e, but this is priced, in our view. A pause in market share gain and high volatility in monthly/quarterly growth figures are potential headwinds. Growth in LCVs, exports and defence is likely to accelerate but is unlikely to be material enough. Early introduction of fleet modernisation policy is a key upside risk not factored into our estimates.

Tata Motors and Ashok Leyland were trading higher by 3% each, recovering from their respective intra-day lows, after they reported a strong set of sales numbers in December 2017.

Tata Motors was up 3% at Rs 439, its highest level since November 10, 2017 on the BSE, after the company’s commercial and passenger vehicles domestic sales grew 52% at 54,627 units in December.

Leading commercial vehicles maker and Hinduja Group flagship Ashok Leyland said it would invest Rs 400 crore over the next two years in developing new products, including left-hand-driving trucks.

"We are coming up with a new product every six months, so the next product would be launched in April or May next year. Ashok Leyland would invest Rs 400 crore on new models in the next two years. The new products are also targeted for export markets", Nitin Seth, president (light commercial vehicles), Ashok Leyland Ltd.

Automobile major Ashok Leyland has reported a 54 per cent jump in medium and heavy commercial vehicle (M&HCV) sales in November at 10,641 units over last year’s count of 6,928 units.

Light commercial vehicle (LCV) sales rose by 44 per cent to 3,819 units, from 2,646 units a year ago.

Hinduja flagship firm Ashok Leyland on Monday said it has inked a pact with its long-standing Japanese partner Hino to jointly develop BS-VI compliant engines.

The companies have entered into a mutual cooperation agreement (MCA) where Ashok Leyland will utilise Hino's engine technology for Euro-VI development and will support Hinos engine parts' purchasing in India for global operation, the Chennai-based firm said in a statement.

n a fillip to the government’s coastal shipping initiative, Ashok Leyland (ALL) on Tuesday sent a second batch of 185 trucks via the sea route to Mongla Port in Bangladesh, a growing market for the company. FE had first reported on October 26 when ALL had sent the first batch of 188 trucks via the coastal route to Bangladesh. The company’s exports to Dhaka has gone up from 500 commercial vehicles (CVs) per year over the last many years to 5,000 per year at present. However, a senior ALL official told FE the cost of sending the vehicles via the sea route is slightly higher versus road transport, but of late, the company had been facing some delays at the India-Bangladesh border on land.

Ashok Leyland Ltd posted a net profit of Rs 334.25 crore during the quarter ended September 30, 2017, up by 14 per cent from Rs 294.4 crore registered during the same quarter of the previous financial year.

Total income grew 23.45 per cent to Rs 6,102.55 crore during the quarter compared to Rs 4,943.23 crore during the corresponding period of the previous financial year.

NEW DELHI: Ashok Leyland is looking at investing Rs 400-500 crore in its electric vehicle business over the next three to five years. Managing director Vinod Dasari told ETthat the commercial vehicle manufacturer, the flagship firm of the Hinduja Group, aims to be future ready. At the same time, he said, the government needs to step up investments in electric vehicle technology to help bring down battery costs and encourage adoption of green mobility solutions.

“We are preparing ourselves for the electric vehicle movement that is going to happen over the next five to 10 years… it’s a question of survival… so (we will invest) at least Rs 400-500 crore over the next three to five years,” Dasari said. He said manufacturers cannot coerce consumers to purchase electric vehicles, and that demand for electric vehicles will take off only when electric vehicles start making economic sense for the buyer.

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