Chennai-based Ashok Leyland reported that its total domestic wholesales for its commercial vehicles in December 2024 stood at 15,713 units, an increase of 4% in comparison to 15,153 units during the corresponding month of the previous year.
The M&HCV segment witnessed an increase of 6% to 10,488 units during December 2024, as against 9,932 units in December 2023. Furthermore, within the M&HCV segment, trucks sales increased by 9% to 8,979 units during December 2024, when compared against 8,213 units recorded in December 2023. Likewise, in the bus segment, the jump seems massive, at 12% to 1,509 units in December 2024, compared to the 1,719 units in September last year.
Secondly, in the LCV category, the company witnessed a flat growth at 5,225 units in December 2024 as against 5,221 units during the comparable period.
As per a research report by ShareKhan, it is bullish on Ashok Leyland on account of its focus on profitability over plain vanilla volume growth strategy, sustaining EBITDA margin over the 10% mark, passing on cost inflation to customers to save profitability, its plans to expand its non-vehicle business, and healthy order inflow in the bus segment.
The report adds that, strategically, Ashok Leyland does not believe in offering high discounts to acquire market share for short-term gain at the cost of loss of operating profitability. While the discounting has been an industry phenomenon, the company continues to explore opportunities to raise prices, supported by strong product demand and improving market conditions.
In tandem with this and in line with the industry’s trend, Ashok Leyland has announced a price hike of up to 3%, effective January 2025. While the truck segment has been observing demand moderation, the rise in order execution in the bus segment would cushion the fall in overall volume growth, the report continued.