Commercial vehicle maker Ashok Leyland Ltd has decided to stick to its core business and exit multi-purpose vehicle (MPV) segment, said a top company official here on Tuesday.
The company stopped selling MPV STILE that was being made in joint venture with Japanes Nissan Motor Company.
"We have stopped production of STILE. It was not doing well as expected. We may reenter the segment if we see prospects," managing director Vinod K. Dasari told reporters.
Ashok Leyland has decided to write down investment in the joint venture by around Rs.224 crore.
Dasari said there is no change in the equity holding pattern in the joint venture.
He said the joint venture with Nissan rolls out light commercial vehicle (LCV) Dost and variants.
Meanwhile in an effort to become a global bus maker Ashok Leyland has decided to put up bus assembly plants in Africa, Middle East and one in India.
According to Dasari, the company would be shipping out the bus kits to the assembly plants overseas so as to be near the market.
He said each assembly plant may involve an outlay of around Rs.20 crore and the overall capital expenditure for Ashok Leyland this fiscal would be around Rs.100 crore.
Looking forward Dasari said the company hopes to retain its market share and hopes that the LCV would pick up in the coming months.
Meanwhile the company closed last fiscal with a turnover of Rs.13,562 crore up from Rs.9,943 crore posted during 2013-14.
Ashok Leyland posted a net profit of Rs.334.80 crore last year as against a net profit of Rs.29.38 crore posted during 2013-14.
Dasari said the company's debt position is comfortable at Rs.2,600 crore down from Rs.4,600 crore at the end of last financial year.
