Commercial vehicle manufacturer Ashok Leyland is seriously considering a plan to enter the sub-2-ton Light Commercial Vehicle (LCV) segment, said MD & CEO Shenu Agarwal.
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“Having now achieved more than 20% market share in a relatively short period in the 2-ton to 3.5-ton [segment], it gives us confidence that we can be an active player in the sub-2-ton [segment] as well,” he said during the analysts call.
Stating the sub-2 ton market was ‘large sized’, he said it was too early to comment on timeline because it was a very mature market, and ‘entrenched’ with the competition that has been there for many years. And therefore, it would take a few more months to finalise the product.
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On the outlook for FY24, he said their earlier guidance of 8% to 10% growth for Medium and Heavy Commercial Vehicles and 5% to 6% roughly for LCVs for the entire year remained intact.
“We are still maintaining that guidance. And therefore, we think that the momentum would actually further increase going into quarter 2, quarter 3 and so on,” he said.
Mentioning that growth in MHCV segment was slightly muted, owing to the effect of some pre-buying in Q4 of FY23, he said that they expected the growth trajectory to improve going forward.
“Significant allocation towards capital expenditure in the Union Budget 2023-24 would continue to provide the necessary traction to MHCV demand in the near to medium term,” he said.
Citing the recent ₹800 crore order from Defence sector, he said: “it seems like we will have a good pipeline on defence for at least next couple of years, including this year.”