Chennai: Indian automobile manufacturing company Ashok Leyland (ALL) has firmed up its plans to strengthen overseas presence as part of its vision to garner one-third of revenues from exports in Kenya and Bangladesh.
Gopal Mahadevan, chief financial officer, ALL said while Kenya assembly plant was for both trucks and buses, that of Bangladesh was mainly for trucks. “We will be investing $5 million in Kenya and the same amount will be invested by our franchisee in Bangladesh. Both plants will have an annual capacity of 3,000 units to be scaled up based on the demand.”
Mahadevan said Kenya was a key market for the company in the African region. The proposed assembly plant will also help ALL tap the neighboring African countries, including Ivory Coast and Senegal.
The African region, which was earlier dominated by Chinese firms, has now opened up for Indian companies now. To prove it, the company recently bagged $100 million worth of orders from Ivory Coast and another $50 million worth of orders from Senegal. “Being the first mover into these markets, ALL will naturally set to benefit. The company can also offer products at competitive prices,” Mahadevan said. “All these initiatives will make Ashok Leyland one of the top 10 truck makers in the world in next three to five years and exports will contribute 1/3rd to its overall turnover as against less than 1/4th,” he added.
The company’s debt level came down to around Rs 1,300 crore in the June quarter from Rs 3,600 crore, a year ago. Finance cost was reduced to around Rs 33 crore from Rs 70 crore. ALL’s debt equity was at 0.3:1. Overall market share rose to 31replace from 30replace and it came mainly from non-Southern markets, said Mahadevan.
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