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Informist, Wednesday, Feb. 12, 2025

MUMBAI – The medium- to heavy-duty commercial vehicle segment, which remained flat in terms of volume growth in 2024, is showing nascent signs of recovery in the first quarter of 2025, Ashok Leyland's management said in a post-earnings media call. With the industry having seen a 4-5% growth in January, the company remains optimistic for the rest of the year.

Ashok Leyland sold 26,838 medium- to heavy-duty commercial vehicles in the Oct-Dec period, about 1% lower on year, and in-line with the industry trends. While volumes of medium- to heavy-duty trucks sold during the period decreased 2%, volumes of buses of the same tonnage saw a 5% on-year increase. According to the company's management, Ashok Leyland is currently selling 9,000-10,000 medium-heavy duty commercial vehicles per month. 

Though the company's market share in the Apr-Dec period dipped 9% on year, it currently retains a share of over 30% in the medium-heavy commercial vehicle segment, the company's executives said. "The important thing is that we have had very good growth for a few years in this industry. And unlike in the past, where people saw a huge recessionary trend, this year was flat," Ashok Leyland's Managing Director and Chief Executive Officer Shenu Agarwal said. "(We are seeing) signs from January and this quarter already; there are indications of growth picking up once again. We're possibly seeing a different trend unlike in the past. And we've seen good growth," Agarwal said.

Meanwhile, in the two-to-four tonne small commercial vehicle segment, Ashok Leyland's volumes decreased 9% on year in the December quarter. Its market share in the quarter also dipped 2.5%, compared to the first two quarters of 2024-25 (Apr-Mar). The company said this was due to the introduction of new products by its competitors. Ashok Leyland expects its volumes and market share in the small commercial vehicle segment to normalise in the next two quarters. In Apr-Dec, its volumes in the small commercial vehicle segment was 45,021 units, down 4% on year. 

The commercial vehicle maker's export volumes surged 33% on year in the final quarter of 2024. Unlike in the past, where it exported only buses, the company is now planning to have a mix of trucks and buses. Its export growth was driven by growth in the Gulf Cooperation Council markets, United Arab Emirates, and Saudi Arabia. The company said it saw growth in all the export markets it is present in.

Specifically, Ashok Leyland has been seeing good signs of revival from markets in the South Asian Association for Regional Cooperation region. The company intends to focus on its exports in this market in Jan-Mar, its executives said. 

Ashok Leyland also plans to spend INR 8 billion to INR 10 billion for FY25, and is currently finalising plans for the next year. The company will invest INR 2 billion in Hinduja Leyland Finance in the March quarter. It said that it does not expect any immediate or direct impact from tariffs imposed by US President Donald Trump in the recent weeks.

Ashok Leyland reported its December quarter earnings during the market hours. Its net profit for the period was INR 7.62 billion on a revenue of INR 94.79 billion. The company's shares closed at INR 219.35 on the National Stock Exchange, up 7.8%.  End

Reported by Anand JC

Edited by Nishant Maher

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