Order flows for commercial vehicle major Ashok Leyland (flagship company of Hinduja Group) have been picking up over the past month. The most recent one is an order for 1,000 buses from the Ministry of Transport, Angola, worth $43.5 million (Rs 220 crore).
The overall size of the order is not very large in relation to the companys revenues (Rs 7,300 crore for the trailing 12 months); but these orders may contribute at a time when the domestic demand scenario is weak. This is the largest single order bagged by the company over the last six months.
The 30-seater model is a unique vehicle developed by the company to meet the needs of rural population who travel to cities with agricultural produce.
Three hundred such buses were delivered in August 2008, along with 200 Falcon buses. In January 2009, the company got its second order for 500 Eagle mini-buses 50 air-conditioned and 450 non air-conditioned.
Deliveries against is expected to be completed by March 31, 2009.
According to the company, these orders would mark a significant presence in developing markets. The entry into the Angolan market, along side their ongoing operations in South Africa and Kenya, may help strengthen the companys export presence in the high potential sub-Saharan African region.
Late January, Ashok Leyland also bagged a larger order for 875 high-end ultra low entry (ULE) buses from the Delhi Transport Corporation as part of their fleet modernisation.
Worth Rs 480 crore, this is the companys single largest order from a State Transport Corporation in value terms. Supply of 350 a/c and 525 non-a/c buses will commence by mid 2009 and will be completed by September09.
Along with this, the company also bagged maintenance contract worth Rs 71 crore valid for 12 years.
According to the contract, drivers will be trained at the companys modern driver training institute, situated at Burari, near New Delhi, which has been set up jointly with the Government of Delhi.
These orders may help the company report better numbers in the ongoing quarter, which otherwise promises to be a difficult one for vehicle makers.
Source : Business Line (Online Edition) (2/19/2009)
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