Ashok Leyland bags an order for 1750 buses

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Ashok Leyland bags an order for 1750 buses

Ashok Leyland, owned by mutli-billion dollar Hinduja Group, bags an order of 1750 buses from Tamilnadu state transport undertaking.

Leading the heavy duty buses market in India, Ashok Leyland had recently tied up with ICICI bank to finance the vehicles for the next 2 years. This will ensure that the company reached out to the semi-urban & urban markets with customized financial solutions.

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Market Share – M&HCVs Segment

Ashok Leyland leads the market with approximately 41% market share followed by Tata Motors at 36.5%. The heavy bus market is composed of two main segments – above 7.5 tonnes to 12 tonnes & above 12 tonnes to 16.2 tonnes.

Ashok Leyland dominates the 12-16.2 T segments where state undertakings & private companies are the major segments. Its range buses known as The Vikings, Cheetah & 12 M are the tried & tested products in this segment.

Tata Motors leads the 7.5-12 T market with its Startbus & Starbus Ultra range of buses.

The heavy duty buses segment declined in FY 2018 by a substantial 25% but has rebounded in FY 2019 with a growth of around 10% clocking a sale of 39612 units.

Growth Potential

The buses market in India is comparatively small as compared to truck market which clocked around 351,128 unit sales in FY 2019. Globally the buses segment is around 35-40% which indicated substantial room for growth in India. Increasing urbanization, population density & improving infrastructure is pushing towards higher requirement of public transportation. The bus market has grown at an average around 9% from 2000-12 which has recently moderated to around 4% from 2000-17.

Ashok Leyland Share Price

Ashok Leyland stock trades at approximately INR 81.5 at Price to Earnings ratio of 18. Check details here.

You may check the monthly chart below extracted from Zerodha Kite trading platform.

 

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Post Author: Fintox_India

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