Historically, ALL would typically gain market share during recession and then lose it once the market improves basically on account of lower capacity and market penetration. Speaking to the reporters after the company's 50th annual general meeting, executive director (marketing) Amol J Sandil said that introduction of customer-friendly new models and expansion into newer area through new dealerships have helped the company to maintain its market share.

The company for the five-month period ended August has sold 11,909 vehicles as against 9,370 vehicles in the corresponding period of the previous year. Its market share in the truck segment has improved from 26 per cent to 27 per centwhile in the tippers category it has jumped to 50 per cent from 38.8 per cent.

Sandil also said that the company had bagged an order for 2,400 buses for the Gujarat State Transport Corporation which would be completed by the end of the current fiscal. He was also hopeful of major orders from other state transport corporations once the elections are over.

ALL, he said, was trying to create new market in the air-conditioned luxury bus segment. About 25 buses are plying in Mumbai which provide a comfortable point-to-point travel for the commuters. Orders for another 25 buses are there and similar efforts are on with the Delhi Transport Corporation. He also said that the orders from defence establishment have also increased but refused to put a number as to what this year end sale would be.

Insight

Augurs well for stock

Obviously, the demographics of the southern region wherein Ashok Leyland operates has helped the auto major garner an improvement in market share to 35.1 per cent. All ofwhich augurs well for the company's stock, especially since Telco has now diversified into the highly competitive passenger car segment. Thus Ashok Leyland is the only automotive major focussed solely on the commercial vehicle segment. Hence, any investor who wants an exposure to the sector will have to settle on the Ashok Leyland scrip.

Percy Dubash