Ashok Leyland Ltd:Annual Report 2023-24 Analysis

Ashok Leyland Ltd.: A Comprehensive Overview #

About the Company #

Year of Establishment and Founding History #

Ashok Leyland was established in 1948 as Ashok Motors to assemble Austin cars. It was founded by Raghunandan Saran. The company transitioned to manufacturing commercial vehicles in collaboration with Leyland Motors (UK) in 1955.

Headquarters Location and Global Presence #

The headquarters of Ashok Leyland is located in Chennai, India. The company has a global presence, with exports to countries in Africa, the Middle East, SAARC nations, and Southeast Asia. They also have assembly plants outside of India.

Company Vision and Mission #

• Vision: To be among the Top 10 global CV manufacturers.
• Mission: To provide efficient, reliable, and environment-friendly products that offer the best lifecycle cost, driven by cutting-edge technology and innovation, supported by a comprehensive and value-driven service network.

Key Milestones in Their Growth Journey #

• 1955: Collaboration with Leyland Motors (UK) to manufacture commercial vehicles.
• 1987: The Hinduja Group acquired a controlling stake in the company.
• 1993: Launched the “Cargo” range of trucks.
• 2006: Achieved 100,000 vehicle production milestone.
• 2010: Introduced the “U-Truck” platform.
• Present: Focus on electric vehicles (EVs) and alternative fuels.

Stock Exchange Listing Details and Market Capitalization #

Ashok Leyland is listed on the Bombay Stock Exchange (BSE: 500477) and the National Stock Exchange (NSE: ASHOKLEY). Market capitalization fluctuates based on market conditions and company performance. Consult financial resources for the latest figures.

Recent Financial Performance Highlights #

Check reputable financial news sources and Ashok Leyland’s investor relations website for the most current financial performance data.

Management Team and Leadership Structure #

The key personnel includes:

• Chairman: Dheeraj G Hinduja
• Managing Director & CEO: Shenu Agarwal

Notable Awards or Recognitions #

Ashok Leyland has received various awards and recognitions in areas such as product innovation, manufacturing excellence, and sustainability. These are highlighted on their website and in industry publications.

Products #

Complete Product Portfolio with Categories #

• Trucks: Light Commercial Vehicles (LCV), Intermediate Commercial Vehicles (ICV), Heavy Commercial Vehicles (HCV).
• Buses: City Buses, School Buses, Staff Buses, Intercity Buses.
• Engines: Industrial Engines, Marine Engines, Genset Engines.
• Defence Vehicles: Special Application Vehicles for defense purposes.
• Power Solutions: Gensets and related power solutions.
• Electric Vehicles: Electric Buses and Electric Light Commercial Vehicles (LCV).

Flagship or Signature Product Lines #

• Dost: A popular LCV known for its reliability and fuel efficiency.
• Circuit: Ashok Leyland’s electric bus, a pioneering product in the Indian EV market.

Key Technological Innovations or Patents #

• iEGR (Intelligent Exhaust Gas Recirculation): Technology aimed at improving fuel efficiency and reducing emissions.
• Intelligent Driver Assistance System (i-Alert): Connected vehicle technology for real-time monitoring and diagnostics.
• Development of electric vehicle platforms and battery technology.

Manufacturing Facilities and Production Capacity #

Ashok Leyland has multiple manufacturing facilities across India. Production capacity varies based on product type and demand.

Quality Certifications and Standards #

Ashok Leyland adheres to international quality standards such as ISO 9001, ISO 14001, and OHSAS 18001.

Unique Selling Propositions or Technological Advantages #

• Fuel efficiency: Focus on delivering vehicles with optimal fuel consumption.
• Reliability and Durability: Known for robust build quality and dependable performance.
• Customization: Offers customized solutions to meet specific customer requirements.
• Total Cost of Ownership: Emphasizes providing the lowest lifecycle cost for its customers.

Recent Product Launches or R&D Initiatives #

• Electric Light Commercial Vehicle (LCV) range
• Modular platform-based vehicles to cater to diverse applications.

Primary Customers #

Target Industries and Sectors #

• Logistics and Transportation
• Construction and Infrastructure
• Mining
• Public Transportation (Government and Private Operators)
• Education (School Buses)
• Defense

Geographic Markets (Domestic vs. International) #

Ashok Leyland has a strong presence in the domestic Indian market, and also exports to various international markets across Africa, the Middle East, SAARC, and Southeast Asia.

Major Client Segments #

• Fleet Operators
• Individual Truck Owners
• Government Transportation Departments
• Private Bus Operators
• Defense Organizations

Distribution Network and Sales Channels #

Ashok Leyland has a wide distribution network consisting of authorized dealerships, service centers, and sales offices across India and in its international markets.

Major Competitors #

Direct Competitors in India and Globally #

• India: Tata Motors, Mahindra & Mahindra, Volvo Eicher Commercial Vehicles (VECV)
• Globally: Daimler Trucks, Volvo Group, PACCAR, Scania

Competitive Advantages and Disadvantages #

• Advantages: Strong brand reputation in India, established distribution network, focus on fuel efficiency and TCO.
• Disadvantages: Intense competition, reliance on domestic market, fluctuating raw material prices.

How They Differentiate From Competitors #

Ashok Leyland differentiates through:

• Emphasis on customer-centric solutions.
• Robust after-sales service and support.
• Focus on alternate fuel vehicles.
• Technological advancements in fuel efficiency and connectivity.

Industry Challenges and Opportunities #

• Challenges: Increasing competition, stricter emission norms, fluctuating fuel prices, economic slowdowns.
• Opportunities: Growth in e-commerce and logistics sector, government infrastructure projects, increasing demand for buses in urban areas, shift towards electric vehicles.

Market Positioning Strategy #

Ashok Leyland positions itself as a reliable and value-driven commercial vehicle manufacturer focusing on providing the lowest total cost of ownership.

Future Outlook #

Expansion Plans or Growth Strategy #

• Expanding its presence in international markets.
• Strengthening its electric vehicle portfolio.
• Investing in R&D to develop advanced technologies.

Upcoming Products or Innovations #

• New models of electric buses and LCVs.
• Development of hydrogen-powered vehicles.
• Further enhancements in connectivity and driver assistance systems.

Sustainability Initiatives or ESG Commitments #

• Reducing carbon footprint through the development of electric and alternative fuel vehicles.
• Implementing sustainable manufacturing practices.
• Focusing on water conservation and waste management.

Industry Trends Affecting Their Business #

• Stringent emission norms driving adoption of cleaner technologies.
• Increasing demand for electric vehicles.
• Growth of e-commerce and logistics sectors.
• Connectivity and digitalization in the automotive industry.

Long-Term Vision and Strategic Goals #

Ashok Leyland’s long-term vision is to be a leading global commercial vehicle manufacturer through innovation, sustainability, and customer-centricity. They aim to be a dominant player in the electric vehicle segment.

Balance Sheet Analysis #

Comparative Analysis of Assets, Liabilities, and Equity (Consolidated) #

The company’s financial position has strengthened over the past three fiscal years. Total assets grew consistently, indicating expansion and investment. This growth was supported by an increase in total equity, reflecting retained earnings and potentially other equity infusions. Total liabilities also increased, primarily to fund asset growth, with a notable rise in current liabilities in FY24.

Source: Consolidated Balance Sheet (FY24, FY23), Historical Perspective of the Company (FY22)

Significant Changes in Major Line Items (Consolidated, >10% YoY for FY24 vs FY23) #

FY24 saw significant growth in several key financial metrics. Revenue from operations increased by 9.88%, driven by improved sales across segments despite a flat overall CV market. Profit Before Tax (PBT) and Profit After Tax (PAT) experienced substantial growth (70.24% and 83.05% respectively), indicating enhanced operational efficiency, cost management, and better price realization. The increase in Non-Current Investments and Current Loans reflects strategic capital allocation and expanded financing activities by its subsidiary. The rise in borrowings, both non-current and current, supported the company’s growth initiatives and working capital needs.

Source: Consolidated Financial Statements FY24, FY23. Commentary based on Annual Report excerpts.

Working Capital Trends (Consolidated) #

Net working capital increased significantly in FY24, driven by a substantial rise in current assets, particularly cash and cash equivalents and loans (from the financing subsidiary), outpacing the growth in current liabilities. The Current Ratio improved, indicating enhanced short-term liquidity. Inventory turnover saw a slight moderation, while debtor turnover remained relatively stable. The increase in operating profit margin suggests improved operational efficiency, contributing to better working capital management despite overall growth.

Net Working Capital: #

Source: Consolidated Balance Sheet (FY24, FY23), Historical Perspective (FY22). Current Assets & Liabilities for FY22 are from the “Historical Perspective” which might have different aggregation.

Detailed Analysis #

Ashok Leyland Limited Financial Analysis (FY 2023-24) #

Cash Flow Analysis (Standalone & Consolidated) #

Operating Cash Flow (OCF) #

• Standalone (FY24): Net cash from operating activities stood at ₹2,708.64 Crores, a decrease from ₹2,738.08 Crores in FY23. The reduction was primarily driven by an increase in net working capital by ₹1,523 Crores (FY23: ₹105.99 Crores decrease), despite a higher profit from operations after tax (₹4,026.29 Crores vs ₹2,562.51 Crores). Key working capital adjustments included an interim dividend remittance of ₹1,453.48 Crores, increased inventories (₹415.86 Crores), and reduced trade payables (₹868.24 Crores), partially offset by reduced trade receivables (₹494.80 Crores).
• Consolidated (FY24): Net cash used in operating activities was ₹6,099.76 Crores, a significant increase from ₹4,068.92 Crores used in FY23. This was despite a higher profit for the year (₹2,917.13 Crores vs ₹1,431.05 Crores). The primary driver was a substantial increase in net working capital requirements, particularly a ₹9,151.87 Crore increase in non-current and current financial assets (primarily loans related to the financing subsidiary) and a ₹1,453.48 Crore interim dividend remittance.

Investing Cash Flow (ICF) #

• Standalone (FY24): Net cash inflow from investing activities was ₹901.79 Crores, a significant turnaround from a net outflow of ₹1,129.58 Crores in FY23. This was mainly due to proceeds from the sale of current investments (net) of ₹2,602.45 Crores (FY23: purchase of ₹1,586.64 Crores) and inter-corporate deposits repaid by subsidiary (net) of ₹104.90 Crores. Purchase of PPE and intangibles was ₹481.22 Crores (FY23: ₹487.94 Crores), and purchase of non-current investments (primarily in subsidiaries Optare Plc and OHM) amounted to ₹1,566.93 Crores.
• Consolidated (FY24): Net cash inflow from investing activities was ₹1,083.76 Crores, compared to an outflow of ₹2,560.93 Crores in FY23. Key movements included proceeds from sale/ (purchase) of current investments (net) of ₹2,073.72 Crores (FY23: purchase of ₹1,893.45 Crores) and proceeds from sale of current investments relating to financing activities of ₹1,640.00 Crores (FY23: ₹1,050.00 Crores). Purchase of PPE and intangibles was ₹1,050.79 Crores (FY23: ₹842.90 Crores).

Financing Cash Flow (FCF) #

• Standalone (FY24): Net cash used in financing activities was ₹1,917.22 Crores, compared to ₹1,238.26 Crores used in FY23. Major outflows included repayments of non-current borrowings (₹1,105.18 Crores), dividend paid (FY23 related) of ₹763.40 Crores, and interest paid (₹265.62 Crores). This was partially offset by net proceeds from current borrowings of ₹215.30 Crores.
• Consolidated (FY24): Net cash inflow from financing activities was ₹8,129.12 Crores, up from ₹7,051.72 Crores in FY23. This was driven by higher proceeds from non-current borrowings (₹19,011.31 Crores vs ₹15,149.89 Crores) and current borrowings (₹12,517.93 Crores vs ₹5,819.53 Crores), offset by higher repayments of non-current borrowings (₹12,906.94 Crores vs ₹8,035.74 Crores) and current borrowings (₹10,497.59 Crores vs ₹4,975.15 Crores). Dividend paid (FY23 related) was ₹763.40 Crores.

Working Capital Management Efficiency #

• Debtors Turnover: Standalone debtors turnover ratio remained relatively stable at 10.04 times in FY24 compared to 10.05 times in FY23. This indicates consistent efficiency in collecting receivables. Trade receivables (net) decreased from ₹4,049.51 Crores in FY23 to ₹3,554.71 Crores in FY24 (Standalone).
• Inventory Turnover: Standalone inventory turnover ratio decreased to 8.76 times in FY24 from 10.70 times in FY23, suggesting a slowdown in inventory movement. Total inventories (Standalone) increased to ₹3,038.90 Crores in FY24 from ₹2,623.04 Crores in FY23, primarily due to higher finished goods inventory (₹1,564.62 Crores vs ₹1,140.28 Crores). Consolidated inventories also rose to ₹4,103.98 Crores from ₹3,290.34 Crores.
• Trade Payables Turnover: Standalone trade payables turnover ratio improved slightly to 4.86 times in FY24 from 4.67 times in FY23. However, total trade payables (Standalone) decreased to ₹6,207.51 Crores in FY24 from ₹7,075.75 Crores in FY23.
• Current Ratio: Standalone current ratio slightly decreased to 0.94 in FY24 from 1.02 in FY23. Consolidated current ratio was 0.98 in FY24, down from 1.09 in FY23.
• Working Capital: Standalone operating profit before working capital changes was ₹4,026.29 Crores. However, adjustments for changes in working capital led to a net outflow of ₹1,317.65 Crores (excluding dividend remittance effect), indicating increased investment in working capital during FY24. Consolidated figures show even larger working capital absorption, primarily due to the expansion of the financing business. The MD&A notes a marginal increase in working capital requirement at year-end to meet demand improvement.

Capex Analysis #

• Standalone (FY24): The Company incurred ₹481 Crores towards capital expenditure. Key areas included:
  • Regulatory norms (OBD II for MHCV & LCV, CEV V & CPCB 4 for PSB).
  • New product development: Green Energy vehicles (BEV, H2 ICE, Fuel Cell EV) and conventional fuel models (Dost 2.2T, Project Vayu CNG, Multi Axle Coach, ICV bus).
  • Manufacturing capacity and capability improvement (Foundry, Frame side member, LCV & MHCV Engines).
  • Procurement of staff bus and related infrastructure.
  • Safety and Sustenance related improvements.
  • Creation of a new manufacturing facility in Lucknow.
  • Improvement and capacity enhancement of Sales yards.
• Consolidated (FY24): Total addition to non-current assets (Property, Plant and Equipment, and Intangible Assets) was ₹1,949.02 Crores, up from ₹1,615.89 Crores in FY23.
  • Commercial Vehicle segment: ₹774.41 Crores (FY23: ₹727.16 Crores).
  • Financial Service segment: ₹1,174.61 Crores (FY23: ₹888.73 Crores).
• The Chairman’s message highlights that over 30% of last year’s sales came from newly launched products, indicating returns on R&D and capex in product development.

Dividend and Share Buyback Trends #

• Dividend (FY24): An interim dividend of ₹4.95 per equity share was declared on March 25, 2024, and paid on April 18, 2024. The Board recommended this interim dividend be confirmed as the final dividend for FY24. This represents a total outflow of ₹1,453.48 Crores.
• Dividend Trend:
  • FY23: ₹2.60 per share (Final)
  • FY22: ₹1.00 per share (Final)
  • FY21: ₹0.50 per share (Interim, confirmed as Final)
  • FY20: ₹0.50 per share (Interim, confirmed as Final) The dividend per share has shown a significant increasing trend from FY20-FY21 levels, with a substantial jump in FY24.
• Share Buyback: There is no mention of any share buyback activities in the provided excerpts for FY24 or recent years.
• Dividend Distribution Policy: The Company has a Dividend Distribution Policy in line with SEBI regulations, available on its website.

Debt Service Coverage #

• Interest Coverage Ratio (Standalone): Improved significantly to 11.84 times in FY24 from 6.55 times in FY23. This substantial improvement is attributed to higher profitability (EBITDA) and lower finance costs.
• Finance Costs (Standalone): Decreased by 14% in FY24 to ₹346.57 Crores from ₹401.96 Crores in FY23. This was primarily due to better management of cash and working capital, and no fresh long-term loans availed during the year. Cash generated was used to repay existing loans.
• Debt Position (Standalone): Long-term borrowings stood at ₹1,771.31 Crores as at March 31, 2024, down from ₹2,913.47 Crores as at March 31, 2023. NCDs amounting to ₹600 Crores were redeemed, and ₹216.25 Crores of Rupee Term Loans and ₹288.73 Crores of ECBs were repaid.
• Debt Equity Ratio (Standalone Net): Improved to 0.02 in FY24 from 0.15 in FY23, indicating a stronger balance sheet and lower reliance on debt. The company’s net debt at the end of FY24 is stated to be close to Zero (MD&A).
• Consolidated Borrowings: Total borrowings (Non-current + Current) increased significantly to ₹40,101.61 Crores in FY24 from ₹30,935.20 Crores in FY23, largely driven by the financing activities of its subsidiary, Hinduja Leyland Finance Limited.

Liquidity Position and Cash Conversion Cycle #

• Liquidity Position (Standalone):
  • Cash and cash equivalents increased to ₹1,632.91 Crores as at March 31, 2024, from ₹300.81 Crores as at March 31, 2023.
  • Other bank balances (including unclaimed dividend accounts and escrow) stood at ₹1,507.17 Crores (FY23: ₹208.03 Crores).
  • Current investments (primarily mutual funds) decreased to ₹74.82 Crores from ₹2,595.97 Crores.

Ashok Leyland Limited: Financial and Operational Analysis FY 2023-24 #

Revenue and Profitability Performance #

• Record Revenue: Achieved highest-ever sales revenue of ₹38,367 crore in FY 2023-24, a 6% increase. Consolidated revenue from operations reached ₹45,790.64 crore, up from ₹41,672.60 crore in FY23.
• EBITDA Growth: EBITDA reached an all-time high of ₹4,607 crore (standalone), a 57% increase. EBITDA margin (standalone) improved to 12.0% in FY24 from 8.1% in FY23.
• Profit After Tax (PAT): Standalone PAT for FY24 was ₹2,617.87 crore, a 90% increase. Consolidated PAT attributable to owners was ₹2,696.28 crore, up from ₹1,357.30 crore in FY23.
• Earnings Per Share (EPS): Basic EPS (standalone) increased by 90% to ₹8.92. Diluted EPS (standalone) was ₹8.90. Consolidated basic EPS was ₹9.19.
• Drivers: Driven by superior products, customer service focus, and cost reduction. Better price realization and a favorable product mix in high-margin businesses contributed to profitability.

Market Share and Competitive Position #

• M&HCV Segment:
  • Overall: Maintained a domestic market share of 31.1% in M&HCV (Trucks & Buses), a slight decrease of 0.7%.
  • Bus Segment: Emerged as the market leader in the domestic M&HCV bus segment, with market share improving by 5.8% to 33.8%.
• LCV Segment:
  • Achieved the #2 position in the competitive 2-3.5T GVW domestic segment.
  • LCV market share in the 2-3.5T segment crossed 20%, an increase of 0.8% to 20.4%.
• Customer Satisfaction: Moved up to 2nd place in Sales & Service Satisfaction.

Key Products/Services Performance #

• M&HCV Domestic Sales: Sold 116,069 units.
  • Trucks (excluding Defence): 96,995 units (a 5.6% de-growth), attributed to TIV migration.
  • Buses (excluding Defence): 17,956 units (a 67% growth), driven by STU replacements and post-Covid revival.
• LCV Sales: 66,633 vehicles (domestic), comparable to the previous year.
• International Operations: Sold 11,853 units, an increase of 5.0%, despite overall industry exports dropping.
• Power Solutions Business (Engines): Record sale of 32,374 engines, a growth of 41.2%. Revenue surpassed ₹1,000 crore.
• Defence Business: Achieved all-time high revenues, delivering 1,116 CBUs and 818 VFJ kits. Received orders for 1,128 FAT 4x4 and 252 GTV 6x6.
• Aftermarket Business: Grew by 28.0%. Spare parts revenue grew 28% to ₹2,958 Cr.
• New Products: Over 30% of FY24 sales came from newly launched products. Key launches included Ecomet Star 1915, Lynx Smart AC, Bada Dost CNG, and Dost+ CNG. The first Boss electric truck was launched.

Geographic Distribution and Market Penetration #

• Domestic Network:
  • M&HCV: Added 134 new outlets and 1,000+ bays, reaching 943 primary touch-points. ~15% of sales volume came from new outlets.
  • LCV: Added 27 new dealerships and 118 new secondary outlets, taking network coverage to 148 primary & 582 secondary outlets.
• International Markets:
  • Growth achieved despite challenges in anchor markets like Bangladesh, Nepal, and Sri Lanka.
  • GCC (Gulf Cooperation Council) market TIV grew by 25-33%, contributing 50% of International Operations volumes.
  • Significant strides in Africa with distributor appointments in 8 new territories.
• Manufacturing Presence: Plants located in Ennore, Sriperumbudur, Hosur, Bhandara, Alwar, Pantnagar, and Vijayawada. A new integrated commercial vehicle bus plant is being set up in Lucknow.

Segment-wise Capex and Return on Capital #

• Capital Expenditure (Standalone): Incurred ₹481 crore towards capex, primarily for regulatory norms, new product development, manufacturing capacity improvement, and the new Lucknow facility.
• Investments (Standalone): Invested ₹1,198 crore in Optare Plc, UK, ₹300 crore in OHM Global Mobility Private Limited, ₹25 crore in TVS Trucks and Buses Private Limited, and ₹15 crore in Gro Digital Platforms Limited, totaling ₹1,567 crore in cash in subsidiaries.
• Return on Capital Employed (Standalone): Increased significantly to 37.58% in FY24 from 20.45% in FY23.

Risk Framework #

Comprehensive Risk Assessment: Ashok Leyland Limited - FY 2023-24 #

Strategic Risks #

Market Cyclicality & Economic Sensitivity #

• Severity: High
• Likelihood: Medium to High
• Trend: Stable with potential for volatility
• Mitigation Strategies: Diversification across segments, new product launches, expansion into Green Mobility, international market expansion.
• Control Effectiveness: Product portfolio diversification, R&D investment, ERM framework.
• Potential Financial Impact: Fluctuations in sales volume, market share, and profitability.

Competitive Intensity & Product Obsolescence #

• Severity: High
• Likelihood: High
• Trend: Increasing
• Mitigation Strategies: Sustained R&D investment, rapid new product introduction, strategic focus in LCV segment, building a “future-ready” suite of clean energy vehicles.
• Control Effectiveness: Strong R&D pipeline, customer-focused product development.
• Potential Financial Impact: Loss of market share, increased R&D expenditure, price pressures.

Technological Disruption (EVs, Alternative Fuels, Digitalization) #

• Severity: High
• Likelihood: High
• Trend: Accelerating
• Mitigation Strategies: Investment in Switch Mobility, Boss electric truck development, CNG/LNG/Methanol/Hydrogen fuel options development, launch of digital platforms.
• Control Effectiveness: Dedicated subsidiaries for EV and e-MaaS, proactive development across a range of alternative fuels.
• Potential Financial Impact: Significant Capex and R&D investment, new revenue streams, risk of stranded assets.

Operational Risks #

Supply Chain Disruptions #

• Severity: Medium to High
• Likelihood: Medium
• Trend: Moderating but persistent underlying risk
• Mitigation Strategies: Diversified supplier base, ERM framework, proactive engagement with suppliers.
• Control Effectiveness: Strong supplier relationship management, inventory management policies.
• Potential Financial Impact: Production delays, increased input costs, inability to meet demand.

Manufacturing & Operational Efficiency #

• Severity: Medium
• Likelihood: Medium
• Trend: Stable, with continuous improvement focus
• Mitigation Strategies: Focus on cost reduction, Operational Excellence initiative, EHS initiatives.
• Control Effectiveness: ISO certifications, internal audit function, EHS council meetings.
• Potential Financial Impact: Impact on production costs, product quality, and worker safety.

IT Systems & Cybersecurity #

• Severity: High
• Likelihood: Medium
• Trend: Increasing
• Mitigation Strategies: ISO27001:2022 certification, cyber security & maturity assessments, Security Operations Center, investment in security tools.
• Control Effectiveness: Regular assessments and certifications.
• Potential Financial Impact: Disruption of operations, financial reporting inaccuracies, data breaches.

Ashok Leyland FY2023-24 Performance Analysis #

Financial Performance Highlights (FY2023-24) #

Ashok Leyland Limited reported a record performance for the financial year 2023-24.

• Standalone Revenue from Operations: ₹38,367.03 Crores, an increase of 6.1% from ₹36,144.14 Crores in FY2022-23.
• Standalone EBITDA: ₹4,607 Crores (12.0% of revenue), a 57% increase from the previous fiscal year.
• Standalone Profit Before Tax (PBT): ₹3,792.18 Crores, up 79.7% from ₹2,110.40 Crores in FY2022-23.
• Standalone Profit After Tax (PAT): ₹2,617.87 Crores, a 90.0% increase from ₹1,380.11 Crores in FY2022-23.
• Standalone Basic Earnings Per Share (EPS): ₹8.92, compared to ₹4.70 in FY2022-23.
• Consolidated Revenue from Operations: ₹45,790.64 Crores, up 9.9% from ₹41,672.60 Crores in FY2022-23.
• Consolidated Profit After Tax (attributable to owners): ₹2,696.31 Crores, an 84.2% increase from ₹1,463.94 Crores in FY2022-23.
• Consolidated Basic Earnings Per Share (EPS): ₹9.18, compared to ₹4.99 in FY2022-23.
• Dividend: An interim dividend of ₹4.95 per equity share was declared and paid, recommended as the final dividend for FY2023-24.

Segment-wise Operational Performance (FY2023-24) #

The company achieved its best-ever performance across all product lines and business units.

• Medium & Heavy Commercial Vehicles (M&HCV) - Domestic:
  • Total Sales: 116,069 units (1.6% growth YoY).
  • Bus Segment: Market leader with 17,956 units sold (67% growth YoY). Market share in M&HCV buses increased to 33.8% from 28.0% in FY23.
  • Truck Segment (Domestic, excluding Defence): Sales of 96,995 units (5.6% degrowth YoY).
  • Overall M&HCV Market Share (Trucks & Buses): 31.1%.
• Light Commercial Vehicles (LCV) - Domestic:
  • Sales: 66,633 units.
  • Market Share: 20.4%, an increase of 0.8% YoY.
• International Operations:
  • Sales: 11,853 units (5.0% growth YoY).
  • GCC region was a strong performer.
• Power Solutions Business (Engines):
  • Sales: Record 32,374 engines (41.2% growth YoY). Revenue surpassed ₹1,000 Crores.
• Defence Business:
  • Delivered 1,116 completely built-up units (CBUs) and 818 VFJ kits.
• Aftermarket Business:
  • Grew by 28.0% over the previous year, with domestic spare parts revenue (including service products) reaching ₹2,958 Crores.

Strategic Initiatives & Developments #

• Product Innovation & Green Mobility:
  • Over 30% of FY2023-24 sales came from newly launched products.
  • Electric Vehicles (EV) via Switch Mobility:
    • Over 950 electric buses deployed globally.
    • Launched first Boss electric truck; advanced stages of launching a 55T electric tractor-trailer.
    • European market sales planned to begin later in 2024.
  • Alternative Fuels: CNG and LNG trucks/buses are operational. Methanol initiatives are underway. Prototype green hydrogen trucks deployed in operating conditions.
• Digital Ecosystem & New Ventures:
  • Ohm: Entity for e-Mobility as a Service (e-MaaS).
  • Gro: Transport exchange platform progressing well.
  • Re.AL: Digital platform for used vehicle business under development.
  • Vehicle Scrappage Facility: Preparing to launch its first facility under a franchise model.
• Network Expansion & Customer Focus:
  • Moved to 2nd place in Sales & Service Satisfaction.
  • M&HCV: Reaching 943 primary touch-points.
  • LCV: Totaling 148 primary & 582 secondary outlets.
• Cost Optimization & Efficiency:
  • Significant focus on all-round cost reduction contributed to record EBITDA margins (12.0% standalone).

Ashok Leyland Limited ESG Analysis #

ESG and Sustainability Overview #

Report Date: July 2, 2024 Company: Ashok Leyland Limited Subject: Analysis

Ashok Leyland FY 2023-24 Performance Analysis #

Financial Performance Analysis (FY 2023-24) #

Ashok Leyland Limited reported record-breaking performance in FY 2023-24. Standalone sales revenue reached ₹38,367 crore, a 6% increase year-over-year. EBITDA surged by 57% to ₹4,607 crore. Consolidated revenue stood at ₹45,791 crore, up from ₹41,673 crore in FY23.

Standalone net profit after tax increased by 90% to ₹2,618 crore. Basic Earnings Per Share (EPS) improved to ₹8.92 from ₹4.70. Consolidated net profit after tax was ₹2,696 crore compared to ₹1,362 crore in the previous year.

Segment-wise Performance Analysis (FY 2023-24) #

Medium & Heavy Commercial Vehicles (M&HCV) #

• Domestic M&HCV sales reached 116,069 units, a growth of 1.6% year-on-year.
• Domestic M&HCV bus sales grew by 67% to 17,956 units. Market share in the M&HCV bus segment improved by 5.8% to 33.8%.
• Domestic M&HCV truck sales (excluding Defence) degrew by 5.6% to 96,995 units.
• Overall M&HCV (trucks and buses) domestic market share was 31.1%, a marginal decrease of 0.7% from FY23.

Light Commercial Vehicles (LCV) #

• LCV sales were 66,633 units.
• The company gained market share, becoming the #2 player in the competitive 2-3.5T GVW segment with a 20.4% share, an increase of 0.8%.

International Operations (IO) #

• Export sales grew by 5.0% to 11,853 units.
• GCC markets contributed 50% of IO volumes.

Power Solutions Business (Engines) #

• Record sales of 32,374 engines were achieved, a growth of 41.2% year-over-year.
• Revenue for the PSB surpassed ₹1,000 crore (59% revenue growth).

Defence Business #

• Achieved all-time high revenues, delivering 1,116 completely built-up units (CBUs) and 818 VFJ kits.
• Significant orders were received, including 1,128 FAT 4x4 and 252 GTV 6x6 units.

Aftermarket Business #

• The aftermarket business grew by 28.0% over the previous year.
• Network expansion continued with 134 new outlets and 1,000+ bays added.

Financial Health and Key Ratios (Standalone - FY 2023-24 vs FY 2022-23) #

Profitability #

• Operating Profit Margin (EBITDA/Revenue): Improved to 12.0% from 8.1%.
• Net Profit Margin (PAT/Revenue): Increased to 6.82% from