MOSL: ASHOK LEYLAND (Buy)-EGR Solution for BS4 could give competitive advantage-Focus on making business acyclic
​Ashok Leyland: EGR Solution for BS4 could give competitive advantage; Focus on making business acyclic
(AL IN, Mkt Cap USD3.6b, CMP INR85, TP INR98, 15% Upside, Buy)
We attended the Ashok Leylands’ Global Conference 2017, themed ‘Conquer New Frontiers’. Mr Dheeraj Hinduja (Chairman) and Mr Vinod Dasari (MD) highlighted initiatives taken by AL to leverage on evolving CV industry dynamics and making business cyclical by reducing India truck business revenues to 50% in 5 years (from ~70% currently).
Key highlights from the conference:
- ​Expects to gain competitive advantage driven by EGR solution for BS3 due to lower initial cost and operating cost
- While near term CV demand is expected to be weak, macro parameters suggests recovery is no too far.
- AL’s confidence in conversion of BS3 inventory to BS4 is based on EGR technology. Expects conversion cost at INR300-400m for its 10k units inventory.
- AL is prepared for changing CV industry environment to gain competitive advantage by not only delivering high quality service and spares, but also offering cost effective digitally enabled trucks.
- AL is highly focused on making business acyclical by reducing India truck business revenues to 50% in 5 years (from ~70% currently), by growing share of LCVs, Exports, Spare parts and Defence
Ashok Leyland Limited is a holding company. The Company is engaged in Commercial vehicles and related components. Through its subsidiaries, it is engaged in manufacturing and trading in Medium and Heavy Commercial Vehicle, Light Commercial Vehicles, Passenger vehicles, automotive aggregates, vehicle financing and engineering design services. It offers a range of 18 to 80-seater buses under categories, such as city application and electric buses. It offers a range of trucks, which include long haul trucks, mining and construction trucks, and distribution trucks. It designs, develops and manufactures defense vehicles for armed forces. It offers Light Vehicles, which include DOST, PARTNER, STiLE and MiTR. It offers power solutions for electric power generation, agricultural harvester combines, earth moving and construction equipment, and marine and other non-automotive applications. It has operations in India, Sri Lanka, Bangladesh, Mauritius, the Middle East and Africa.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.