Ashok Leyland will continue to disinvest in non-core assets and investments to right size its balance sheet. With performance being key, focus would lay on reducing discretionary spending and centralising support functions. In spite of lower revenues and heavy discounting, the company reports net profit of Rs 29 Crs (Rs 434 Crs) to sustain its unbeaten track record of reporting profits year after year. The first consolidated financial results of stands at a loss of Rs 164 Crores for the year, essentially from some start-up ventures.
“In FY’14, we retained our market share in an intensely competitive M&HCV market that declined by over 25% , second year in a row,” said Mr Vinod K Dasari, MD, presenting the annual results of Ashok Leyland, the Hinduja Group flagship. “In a very tough year, we restructured ourselves to reduce the overall fixed cost base while continuing to invest in new products, network, quality and sales processes. We also sold non-core assets, and reduced our working capital drastically, and used the funds to reduce debt.”
“While the BOSS and the CAPTAIN launches have excited the ICV and Tipper segment customers, the launch of STiLE, PARTNER and MiTR in the LCV space have made us a complete range player,” added Mr Dasari. Ashok Leyland sold 28,995 vehicles in the LCV segment during FY’14, while expanding its LCV dealer network. The Company exported 8,517 vehicles, despite a drastic fall in the Sri Lankan market. “We believe the worst is over, we used the downturn to transform the Company in many ways. With a stable government, we now expect the market to revive, starting possibly in the next quarter itself”, he added.
Ashok Leyland’s domestic M&HCV sales volume stood at 51,830 units. Network expansion improved reach and customer satisfaction to gain market share in several regions.