Ashok Leyland Ltd, the country's second-largest commercial vehicle manufacturer, is expecting the fourth quarter to see good growth numbers while the current quarter growth could be tepid, owing to the government's demonetisation move and other issues, according to a senior management official.
The demonetisation impact will go off and the Euro IV pre-buy is expected to start in the fourth quarter, which would help good growth, said Gopal Mahadevan, chief financial officer of Ashok Leyland. He was speaking on the sidelines of the Tamil Nadu Finance Conclave organised by Confederation of Indian Industry (CII).
Ashok Leyland's total sales were up by three per cent between April to November 2016, to 86714 units from 84309 units during the same period of last year. M&HCV sales were up by two per cent during the period, to 65871 units from 64810 units, while LCV sales grew by seven per cent to 20843 units from 19499 units during the same period of previous year.
The uncertainties the market faced earlier before the fixation of the GST rates has been settled, with the clarification that there is no major difference in rates due to GST implementation. There will be a cost difference between Rs 50,000-1 lakh between the Euro IV and the previous versions and that would be one of the deciding factors for the customers.
Commenting on the impact of Cyclone Vardah on the company's operations, he said that it will not have an impact, but it is a disruption. The production was affected for two days, he added.
The industry can prepare to face such natural disasters, which could reduce the impact further. The company had continuous reports from various places on what is happening in each location, the communications were on all time and the company has invested in some alternate communication, he added. A central desk was set up to ensure all the employee families are safe.