Ashok Leyland skids 2% on profit-booking, subsidiary secures $50-mn funding

Shares of Ashok Leyland Limited declined 2 percent to Rs 161 in the morning trade on March 15 as investors rushed to book profits a day after the stock rallied 3 percent.

At 10am, the stock was trading at Rs 162, down 1 percent from the previous close on the NSE. The counter has had a rough start to the year, slipping almost 10 percent on the bourses.

The company also announced that Hinduja Tech, a subsidiary, signed a definitive agreement for Creador to invest $50 million in acquiring 19.6 percent stake in the company.

This investment places Hinduja Tech at a post-money equity value of $255 million. Creador is a private equity firm focused on partnering with businesses in Southeast Asia and India.

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The capital infusion will empower the company to bolster its research and development capabilities, leveraging organic growth and strategic acquisitions. This move aims to amplify its global presence and further solidify its position in sustainable engineering mobility solutions. In FY 2023, Hinduja Tech acquired Drive System Design, a UK  and US-based company, specializing in e-powertrain design.

Hinduja Tech had forged partnerships with key stakeholders in the mobility sector. These collaborations span from conventional buses and sports cars to electric and autonomous vehicles. “We have an ambitious growth plan in the sustainable engineering mobility segment. Their investment will allow Hinduja Tech to accelerate its global growth plans,” Kumar Prabhas, CEO of the company, said in an exchange filing.

Ashok Leyland reported a standalone net profit of Rs 580 crore for third quarter of FY24, clocking a 60 percent rise over the year-ago period. The company’s standalone revenue during the quarter came in at Rs 9,273 crore, marginally higher by 2.7 percent.

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