Ashok Leyland FY08 sales up marginally

Hinduja Group flagship Ashok Leyland finished the year ended March 31, 2008 with sales of 83,309 vehicles when compared with 83,094 units sold in 2007, according to an official statement released today.

Domestic sales in the M&HCV segment dropped to 75,408 units from 76,736 units, but domestic LCV sales increased to 615 units from 333 units sold in 2007.

Exports increased 21% to 7,286 vehicles from 6,025 in FY07. Total production for the year was 84,006 units when compared with 83,558 units in the last fiscal.

Eicher Motors sales decline marginally in March

Eicher Motors today reported a marginal decline in sales at 3,704 units in March when compared with 3,730 units sold in March 2007.

Domestic sales were flat at 3,297 units when compared with 3,283 units in March 2007. Exports declined 9% to 407 units from 447 units.

For the year ended March 31, 2008, sales increased 6% to 29,827 units from 28,072 units sold in FY07.

Crisil revises Ashok Leyland outlook to -ve

Rating agency Crisil has revised its rating outlook on the non-convertible debenture programme of the commercial vehicle manufacturer Ashok Leyland to ‘negative’ from ‘stable’ and reaffirmed its rating on the company’s commercial paper programme at ‘P1+’.

The revision in outlook reflects the likelihood of Ashok Leyland’s financial leverage increasing over the medium term, owing to its large committed debt-funded capital expenditure and investment plans. Due to the increased financial risk, the rating could become vulnerable in the scenario of a continued slowdown in the domestic medium and heavy commercial vehicle (M&HCV) segment, a release from the Crisil stated.

The agency expects that Ashok Leyland will implement its Rs 2,000 crore M&HCV project in Uttaranchal by March 2010 in order to avail of the fiscal benefits offered by the government. In addition, the fiscal benefits offered by the Uttaranchal project would also benefit the company over the medium to long term.

The deterioration in Ashok Leyland’s financial profile may correct itself over the medium term if M&HCV sales revive and the benefits from the capacity enhancement are realised. The performance of the domestic M&HCV industry and the ability of Ashok Leyland to reduce its exposure to the M&HCV market through its ventures in the light commercial vehicle (LCV), passenger vehicle, and engine segments, and through exports, will be key determinants of the company’s credit quality in the context of its increased financial risk profile.

Ashok Leyland’s operating margins for 2007-08 are estimated at 9.5 per cent in spite of a significant increase in raw material costs. Continuous cost reduction efforts, recent hikes in vehicle prices, and an improved working capital cycle are expected to cushion pressures on the company’s operating margins from input price hikes.

The company is slated to increase its capacity to 184,000 vehicles per annum from the current 84,000 vehicles per annum over the next four to five years. The rating is also constrained by Ashok Leyland’s vulnerability to cyclicality in the domestic demand for CVs, and limited success in the fast-growing LCV segment.

Ashok Leyland completes $200 mn ECB

Ashok Leyland, the Indian flagship of the Hinduja Group, has concluded an External Commercial Borrowing (ECB) programme of $200 million. This is the largest ever loan taken by the company in a single transaction till date.

The company has broad based its relationships, with the facility being subscribed to by several banks including the leading foreign banks. The loan will partly fund the requirements of the company to meet its expansion plans and overseas investments.

As per the guidelines of RBI, companies can use the proceeds of ECB only for meeting forex requirements for capital expenditure and other overseas investment purposes. Accordingly, RBI has given a go ahead to the company to proceed with the drawdown.

Said K Sridharan, Chief Financial Officer, Ashok Leyland: “This deal is significant for the company in many ways. Meant to meet the company’s funding requirements, the deal got successfully completed at a time when the global financial markets are in turmoil.”

The funds would be drawn over the permitted period and the company would be taking necessary hedging measures to protect itself from the vagaries of exchange markets.

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Ashok Leyland vehicle sales up 8% in December

Ashok Leyland Ltd said on Monday that it sold 6,340 vehicles in December, up 8 per cent from 5,873 units a year earlier. It said domestic sales rose 2 per cent to 5,488 units from 5,396 units, while exports rose to 852 units from 477 units.

Advanta India acquires Unicorn Seeds

Seed marketing company Advanta India Ltd on Monday said it has acquired vegetable seeds business of Hyderabad-based Unicom Seeds Ltd for an undisclosed amount.

The acquisition would strengthen the company's position in the vegetable seed market and increase its product portfolio, Advanta India said in a communiqué to the Bombay Stock Exchange.

"We hope to leverage the strong brand equity of Unicom, excellent breeding programs and outstanding production capabilities to strengthen the leadership position in this market segment," Advanta India said.

Advanta India Ltd is a 100 per cent subsidiary of United Phosphorus Ltd. It deals with the research, development, production and marketing of hybrid seeds.

Unicom has a strong presence in the domestic and export markets of vegetable seeds and is also engaged in custom production for key vegetable seed suppliers in Europe, Asia and USA.

Marksans Pharma buys UK-based Hale Group

Marksans Pharma on Monday said it has acquired UK-based pharma company Hale Group for an undisclosed amount.

The UK-based subsidiary of the company, Marksans Pharma (UK) Ltd, has entered into a definitive agreement with Hale Group Ltd, the parent company of Bell, Sons and Co (Druggists) Ltd, to acquire the latter, Marksans said in a filing to the Bombay Stock E xchange.

Eicher Motors December sales up 2.7%

Commercial vehicle maker Eicher Motors on Monday reported a 2.7 per cent increase in its sales during December, 2007 at 2,233 units as against 2,174 units in the same month previous year.

Sales of the company's light commercial vehicles were up marginally to 1,775 units compared to 1,742 units in December 2006, Eicher Motors said in a statement.

Heavy commercial vehicle sales rose to 458 units in the said period as against 432 in the corresponding month last year.

In the April-December period, the company sold 19,686 units as against 17,700 units in the same period of previous fiscal, up 11.2 per cent year-on-year.

Sun TV Network hikes advt rates

Television Broadcaster Sun TV Network Ltd is increasing its advertisement rates with effect from February 1 this year, in Tamil channel by 10 % to 21 %, in Telugu Channel (Gemini TV) by 15 %, in Kannada Channel (Udaya TV) by 10 % to 20 %, in Mala yalam Channel (Surya TV) by 3 % to 13 %.

Two programmes of the company whose TRPs are extremely high, the hike in advertisement rates is over 30%. For other channels like Sun Music, Sun News, Gemini Music, Gemini News, Teja, Udaya Movies, Udaya Varthagalu, Udaya II, Kiran the increase in advert isement rates range from 10% to 25%.

Simultaneously, the slot fees (broadcast fees) received from the content producers is also increased proportionately effective February 15, 2008.

Suzlon Energy arm in Denmark bags order

Suzlon Energy Ltd has informed the BSE that the company through Suzlon Wind Energy A/S, Denmark, its step-down wholly owned subsidiary further consolidated its position in the Spanish wind energy market with an order for 42.5 MW of wind turbine c apacity.

The contract would be supplied through 22 units of Suzlon's S88 2.1 MW turbines.