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Ashok Leyland plans $721m investment
Ashok Leyland, India's second-biggest bus and truck maker, will spend Rs30 billion ($721 million, Dh2.72 billion) in capital expenditure over the next three years to more than double capacity from 84,000 vehicles now, it said on Thursday.
- Reuters
- Published: 00:43 May 9, 2008
Mumbai: Ashok Leyland, India's second-biggest bus and truck maker, will spend Rs30 billion ($721 million, Dh2.72 billion) in capital expenditure over the next three years to more than double capacity from 84,000 vehicles now, it said on Thursday.
The Chennai-based company, which trails leader Tata Motors Ltd, will launch its iBus this year and also extend its range of tractors, it said in a statement.
Earlier on Thursday, Leyland reported a better-than-expected five per cent rise in its fiscal fourth-quarter net profit to Rs1.81 billion from Rs1.72 billion a year earlier. Net sales rose to Rs25.62 billion from Rs22.91 billion.
A analysts' poll had forecast net profit of Rs1.68 billion on net sales of Rs24.26 billion.
Its operating margin, a key measure of profitability, expanded by 60 basis points to 10.4 per cent.
"In terms of topline, we compensated for the slowdown in the truck market by significantly improving our share of the bus market, international operations, as also the engines and spares businesses," said managing director R. Seshasayee. "Our bottomline benefited from some aggressive value engineering, sourcing initiatives and higher productivity."
Performance
Leyland, which has ventures with Japan's Nissan Motor Co for trucks, engines and components, said full-year net profit rose six per cent to Rs4.7 billion.
Vehicle sales during the March quarter rose 4.5 per cent to 27,311 units. Higher interest rates have weighed on demand for buses and trucks in the past year, as banks tightened credit.
But a growing focus on improving India's network of roads and highways is helping, Seshasayee said.
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