Ashok Leyland - All Set For A Strong Commercial Vehicle Upcycle: Centrum Broking Initiates Coverage
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Centrum Broking Report
We are optimistic on Ashok Leyland Ltd. as we believe that the commercial vehicle industry is getting into an economic recovery led upcycle for the next two to three years.
CV industry declined by 29%/21% in FY19/FY20 pushing the sales down to a decade low levels.
Since, CV industry is highly dependent on the gross domestic product with a correlation of 0.9, we expect a strong recovery in CV cycle on a low base as India’s GDP is expected to grow at low double digits in FY22.
Over the last few years, the company has strengthened its light commercial vehicle portfolio and has gained market share.
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