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Leyland turnover crosses $1 b; net up 40 pc

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Mr R. Seshasayee (right), Managing Director, Ashok Leyland Ltd, and Mr K. Sridharan, Executive Director (Finance), at a press conference in Chennai on Thursday. — Bijoy Ghosh

Chennai , April 28

ASHOK Leyland has reported sales of Rs 4,811.28 crore for the year 2004-05 and as such, the company has joined the `billion dollar league.' In the previous year, the company's turnover was Rs 3,927.27 crore.

The company's net profit increased 40 per cent over the previous year, to reach Rs 271.41 crore from Rs 193.58 crore in 2003-04. The company's board has recommended a dividend of Rs 1 for each share of Rs 1, or 100 per cent, against 75 per cent previously.

In 2004-05, the company sold 54,740 vehicles compared with 48,654 in the previous year. Sales included exports of 6,812, which was a record high.

At a press conference here on Thursday, Ashok Leyland's Managing Director, Mr R. Seshasayee, said that the company would be making capital investments of Rs 400 crore in the current year. About Rs 70 crore would be for a new cab making facility and another Rs 100 crore for producing J-series engines. The rest of the proposed investment would be made in increasing the capacities of its engines and gear-boxes.

The expansion would be funded out of the proceeds of a $100-million foreign currency convertible bond issue, which happened last year.

During 2004-05, Ashok Leyland's capacity increased from 50,000 to 67,000. The proposed capital investment would take the capacity to 77,000 by the second quarter of the current year. The company has plans to expand capacity further to 100,000 in the next two years.

Alongside, Ashok Leyland was in talks with Weichai of China, for sourcing engines from that company, Mr Seshasayee said.

Despite record sales both in terms of volume and value, he said that last year was "a forgettable year" because the company could have sold at least 5,000 vehicles more but for the two-month-long strike at its Hosur-I unit. He said he expected a 10 per cent growth in the current year.

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