Ashok Leyland Targets 25% Market Share with New LCV Lineup

Ashok Leyland, one of the largest commercial vehicle manufacturers, plans to launch six new light commercial vehicles in the next 12 months. This new rollout is part of their plan to grow their light commercial vehicles (LCV) market share from the current 20% to 25%.

Amandeep Singh, who heads the international business at Ashok Leyland, stated that this year, they have 6 variants of the Dost lined up. Dost is a range of pick-up trucks. He added, “We will launch one model every alternate month starting this month-end. This will come with varied payload, technology, and volume capacity.”

According to Amandeep Singh, the company’s target is to achieve 25% of the market share in LCVs in the next two years. He also stated that the company has been profiting from the upward shift in the tonnage – from sub-2-tonne to 2-3.5 tonne in the market. LCVs represent the primary sub-category within the light truck sector. In India, the light truck market, primarily led by Mahindra & Mahindra, encompasses small commercial vehicles. These include those with a gross vehicle weight (GVW) below two tonnes and those ranging from 2 to 3.5 tonnes.

Amandeep Singh further added that while Tata Motors is still the second largest (by volume) in the overall LCV segment, it has lost its position to Ashok Leyland, which sells the Dost and Bada Dost branded light trucks in the 2-3.5 tonne segment. Leyland is not in the sub-2 tonne segment, where Tata Motors sells the Ace branded small and light trucks.

In the Indian market, overall sales of light trucks declined to approximately 5,42,000 units in FY 2024 from 5,59,000 units the previous year. This is due to weakened rural demand and other factors. However, Ashok Leyland, the third-largest player after M&M and Tata Motors, increased its market share to 12.10% from 11.74%, with volumes rising marginally to 65,678 units from 65,654 units during the same period, according to data from the Society of Indian Automobile Manufacturers.

M&M also gained over 300 basis points, capturing 46.32% of the market, while Tata Motors’ share decreased from 35.71% to 32.45% in the same period.

Ashok Leyland is confident that the prediction of a good monsoon, change in consumption pattern from bulk to packaged and revival in rural sales can boost overall light truck sales in India in the coming months.

Mr Singh also added that to boost its overall presence, last month, the Hinduja Group’s EV-making arm, Switch Mobility, launched an electrified version of the 3.5-tonne Bada Dost in five metros and is currently readying to launch the brand’s electrified version with lower GVW.

On May 6, 2024, the share price of Ashok Leyland Ltd opened at ₹203.70, touching the day’s high at ₹204.90, as of 9:42 AM on the NSE.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.