Ashok Leyland to focus on CVs ~647-cr impairment

Commercial vehicle major Ashok Leyland chairman Dheeraj G Hinduja said the company will continue to provide thrust to the core business of commercial vehicles and build a portfolio of profitable segments.

Hinduja said the company performance was "remarkable" last year and this was achieved in a year when the overall industry sales volume was static, and demonetisation and implementation of BS-IV emission norms had dampening effects on sales volume growth.

In the medium and heavy duty segment, a sales volume of 102,313 vehicles was realised in a flat market of 302,529 vehicles registering a growth of four per Ashok Leyland has taken an impairment hit of ~647 crore for 2016-17 after studying its intrinsic value of investments in associates, joint ventures, and subsidiaries. It has said 7,123 BS-III vehicles identified for conversion have been classified as work in progress (impact ~815 crore). cent and a market share of 33.8 per cent. The truck segment posted an overall share of 33.1 per cent, which is a record.

In the bus segment, due to strategic shift to exit unprofitable segments, there is a decline seen in the market share which will be overcome shortly through appropriate countermeasures, he added.

He said, Ashok Leyland will sharpen the light commercial vehicle (LCV) strategy and a slew of products are already in the pipeline. LCV market grew 7.4 per cent and with a sale of 31,770 vehicles, Ashok Leyland retained the share in this segment despite fierce competition and only one product in the line-up, said Hinduja.

Hinduja said that due to adverse conditions in target markets, Ashok Leyland's performance in the international markets has been modest. He said international business will be a very important lever of growth for the company, with new bus plants planned in Africa in 2017-18.

Looking ahead, Ashok Leyland is wellpositioned to capture the upsides owing to various developments in India and outside, said Hinduja.