Ashok Leyland to invest Rs 550 Cr in next two years

Chennai, Apr 29 (UNI) Ashok Leyland, the Hinduja Group flagship in India, has proposed to pump in an investment of Rs 550 crore in the next two years on capacity expansion and drawn out an ambitious plan to roll out a host of new products in the coming years.

Announcing this at a press conference here, Ashok Leyland Managing Director R Seshasayee said the vehicle production was up by 19 per cent, touching an all time high of 65,000 numbers during 2005-06 and on way to expand the capacity to produce 75,000 numbers during this year and ultimately to 100,000 vehicles.

The fresh investment would be utilised to expand the capacity in the production of engines and gear boxes to 100,000 and modernise some of the products, he said adding the investments would take place during 2006-07 and 2007-08.

Giving details of the company's performance during 2005-06, Mr Seshasayee said with market share gains in every product segment and overall volume growth of 12.6 per cent, Ashok Leyland had registered a turnover of Rs 60,531.08 million during 2005-06. This was 25.8 per cent over the last fiscal's turnover of Rs 48,108.01 million.

The Company has earned a net profit of Rs 3.3 billion and has proposed to declare a dividend of 120 per cent for 2005-06 as against 100 per cent in the previous year.

He said the overall Commercial vehicle growth was 10.6 per cent from last year's negative growth, thanks to the buoyancy in the economy. The Medium Heavy Duty vehicle volume also grew to 17.6 per cent, he added.

The company has received robust orders from the defence at the end of last year and could only partially execute the order. The company proposed to establish a new bus assembly unit in the Middle East with a capacity of 2,000 numbers. The project was on the implementation mode and during the current year, the site would be selected, he said.

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