Ashok Leyland Ltd (ALL) has regained market share in the medium & heavy commercial vehicle (M&HCV) segment, aided by demand recovery in its core south market, new product launches and network expansion amid increased competitive scenario.
The Hinduja flagship improved its market share to 27.1 per cent by the end of first-half of this fiscal from 25.5 per cent in the year-ago period, on the back of a five per cent rise in its M&HCV volumes at 28,290 units in the first-half. The industry volume, however, fell 1.5 per cent during this period. Tata Motors continues to dominate with 54 per cent share.
Gopal Mahadevan, Chief Financial Officer, Ashok Leyland, said that some of the initiatives that the company had executed over the past 2-3 years paid dividends for the company. While the overall sales and service network was doubled to 500 plus in the past one years, new product launches across categories to fill the gaps and deeper penetration in all other markets also helped in improving the sales and thereby boosting the market share. “Most importantly, the southern market, where we have over 50 per cent market share, saw steep revival in truck demand,” he added.
However, the company, which has reported operating profit in Q2 after five successive quarters, is still cautious about growth outlook for the full year despite posting strong numbers for the second-quarter, when its EBITDA margin grew to 7.28 per cent from 4.7 per cent a year-ago. “If the present trend continues in Q3 and Q4, we might end the year with some growth. We saw a mix of growth coming from replacement as well as primary market segments in Q2,” Mr. Mahadevan said.
Meanwhile, ALL looks to sell its subsidiaries Albonair (India) Pvt. Ltd. and Avia Ashok Leyland Motors as part of restructuring plan. “The future does not look appropriate for these,” he added.
