In Q2 FY25, Ashok Leyland sustained its market leadership with a 37% year-on-year increase in Profit After Tax (PAT), reaching INR 770 crore.New Delhi: Ashok Leyland, the country’s leading commercial vehicle manufacturer, anticipates this financial year to be its "best for international business," according to Managing Director and CEO, Shenu Agarwal, during the post-earnings call.
The company is looking to expand into Southeast Asia as part of its global growth strategy, targeting robust domestic performance for the second half of FY25.
Ashok Leyland’s electric vehicle subsidiary, Switch Mobility, is also nearing EBITDA break-even for this fiscal year, confirmed Executive Chairman Dheeraj Hinduja. "We are pleased with Switch Mobility's performance, as it is expected to achieve EBITDA break-even in this fiscal."
In Q2 FY25, Ashok Leyland sustained its market leadership with a 37% year-on-year increase in Profit After Tax (PAT), reaching INR 770 crore.
However, the MHCV (Medium and Heavy Commercial Vehicles) sector, which grew in Q1, saw a slowdown in Q2 due to extreme weather, irregular rainfall, and delayed government capital expenditure, noted Hinduja. "We believe these factors are temporary and remain optimistic about industry prospects for the second half and the medium term, despite lower industry volumes."
Ashok Leyland’s expansion strategy
Ashok Leyland has its sights set on Southeast Asia, aiming to establish a strong presence, beginning with four key markets, Agarwal explained. The company has already launched operations in the Philippines, with Malaysia being the next target.
Despite challenges, exports reported significant growth, with a 14% increase in Q2 and 10% in the first half of FY25. In Africa, the company is strengthening its operations by increasing distributors. "Despite Bangladesh’s economic crisis, the Gulf Cooperation Council (GCC) region remains a top performer...We've broadened our product range for both domestic and international markets," stated the management.
Switch Mobility’s EBITDA break-even
"Switch Mobility has an order of 2,000 buses, expected to be delivered over the next 12-15 months," said Hinduja.
The EV subsidiary, specialising in electric buses and light commercial vehicles (LCVs), projects EBITDA break-even by FY25. Its product lineup includes the IeV series for LCVs and the EiV series for electric buses. Switch Mobility has also expanded its annual production capacity at its Chennai plant to 3,000 electric buses, supporting its growth strategy.
Mini Expo
"We showcased a diverse portfolio, including diesel options and several new alternative fuel products currently under development," said Agarwal regarding the company’s recent mini expos. These expos, held in key cities, highlighted Ashok Leyland's latest advancements in alternative fuel technologies and received a strong customer response.
Additionally, the reverse merger of Hinduja Leyland Finance with Next Digital is progressing smoothly, with completion expected by Q1 FY26 following necessary approvals.
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