The Hindu : Business : Ashok Leyland net at Rs. 478 crore

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Friday, May 09, 2008
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Business

Ashok Leyland net at Rs. 478 crore

Special Correspondent

Maintains dividend at Rs. 1.50 per share; draws up Rs. 3,000-crore expansion programme

R. Seshasayee

CHENNAI: Ashok Leyland, the flagship company of the Hinduja Group, has reported a sales turnover of Rs. 7,729.12 crore during 2007-08, up from Rs. 7,168.18 crore in the previous fiscal. With other income of Rs. 73.99 crore (Rs. 70.80 crore), total income is placed at Rs. 7,803.12 crore (Rs. 7,238.98 crore). The net profit has improved by 6.4 per cent to Rs. 469.31 crore (Rs. 441.29 crore).

Despite higher financial expenses of Rs. 49.74 crore (Rs. 5.33 crore) on account of higher capex, the profit from ordinary activities, before tax, has grown by 5.4 per cent to Rs. 650.88 crore (Rs. 617.58 crore). Income tax has claimed Rs. 166.17 crore (Rs. 162.47 crore) and fringe benefit tax Rs. 7 crore (Rs. 5.15 crore). The net profit from ordinary activities, after tax, is placed at Rs. 477.72 crore (Rs. 449.96 crore). An expenditure of Rs. 8.41 crore (Rs. 8.67 crore) for VRS compensation amortised is an extraordinary item. The company is maintaining the dividend at Rs. 1.50 per share.

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Ashok Leyland will be introducing the ‘iBus’ this year.

During the year, total sales has reached an all-time high of 83,307 vehicles (83,094 vehicles), a marginal rise despite a shrinkage in the domestic market. Sales volumes were shored up by its good performance in the bus segment which grew 35 per cent.

Re-appointed

Addressing a press conference here on Thursday, R. Seshasayee, Managing Director, said 2008-09 “is a difficult year to predict.” Stating that “all fundamentals look good,” he, however, pointed out that “global issues are casting their shadows.” Mr. Seshasayee, who has been re-appointed as the Managing Director by the board, said India was inexorably linked to the world and, hence, could not wish away the happenings on the international scene. “The business sentiment appears to be very low. That is a worrying factor,” he said. He said the escalating commodity prices were “growth threatening factors.”

Mr. Seshasayee said that Ashok Leyland had no intention to cut back on investment. He said the company would more than double its current capacity of 84,000 vehicles annually within three years and had drawn up a Rs. 3,000-crore capex programme over the next three years.

Going forward, Ashok Leyland would focus on three things — having fully-built designs in every vehicle segment, enlarging the scope of product offering and looking for footprints outside India even through the acquisition route. He said the company would introduce iBus this year, post-concept validation at the Auto Expo.

To address the growing tractor market, the company was extending its range of tractors. In the current year, 4,921 tractors and 3,121 multi-axle vehicles were being taken up for full-scale production and all-India marketing.

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