The company said that FY26 investments would be based on the requirements of group companies, with Switch India and Hinduja Leyland Finance currently identified as likely candidates.
23 May 2025 | 614 Views | By Darshan Nakhwa and Yukta Mudgal
India’s second-largest commercial vehicle maker, Ashok Leyland, has reaffirmed its commitment to future growth by maintaining its capital expenditure at ₹1,000 crore for FY26, mirroring the outlay in FY25. The company also indicated it will continue to strategically invest in key group subsidiaries like Switch Mobility’s India unit and Hinduja ...
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India’s second-largest commercial vehicle maker, Ashok Leyland, has reaffirmed its commitment to future growth by maintaining its capital expenditure at ₹1,000 crore for FY26, mirroring the outlay in FY25. The company also indicated it will continue to strategically invest in key group subsidiaries like Switch Mobility’s India unit and Hinduja Leyland Finance, depending on emerging requirements.
“In FY25, we incurred close to ₹1,000 crore of capex, and we will incur a similar kind of capex in the coming year as well,” said K.M. Balaji, Chief Financial Officer, during the company’s post-earnings briefing.
Balaji further noted that group-level investments in FY26 will be calibrated based on the needs of specific subsidiaries. “As far as investments in FY26 are concerned, we will decide based on the requirements of the group companies. As of now, the requirements are visible from Switch India and Hinduja Leyland Finance. These are some of the companies where we would be required to invest, and we will decide on the quantum as we progress during the financial year,” he said.
With its financial health significantly strengthened over the past year, Ashok Leyland is now in a position to deploy internal resources to accelerate growth. Highlighting the company’s turnaround, Shenu Agarwal, Managing Director and CEO, said, “Just to add to that, you have noticed our cash position at the end of FY25. Last year, in FY24, we were at ₹89 crore of net debt, but now we are at a net cash surplus of ₹4,242 crore.”
“That really means we can invest a lot of this cash in the future growth of the company,” he added.
The company is gearing up to deploy this liquidity to boost product innovation, technology development, and after-sales service—areas that Agarwal described as central to Ashok Leyland’s long-term strategy. “We are very clear that this future growth will come on the strength of the products and technologies that we offer to the market, and also the customer experience we provide after the sale,” he said.
“On both these fronts, we have some aggressive plans. Now, since the company is in a much stronger cash position, it gives us more liberty to really ramp up our efforts—both on the product technology front and the after-sales side,” Agarwal concluded.
Ashok Leyland’s strong financial footing comes at a time when the commercial vehicle sector is expected to face moderate growth, with potential headwinds from global macroeconomic uncertainty. However, the company appears well-positioned to sustain momentum through focused investments and a robust balance sheet.
(With inputs from Ketan Thakkar)