I NTRODUCTORY PART

GROWTH
The Growth Score is a relevant measure for the assessment of a stock
attractiveness. Ashok Leyland Limited shows a Growth Score of 6.00.
The Growth Score for Ashok Leyland Limited is significantly higher than its peer
group's. This means that Ashok Leyland Limited has a significantly higher growth
than its peer group.

In the first nine months, the company’s

volumes increased 18 per cent, boosted by robust growth in the first half. To achieve
the targeted 15 per cent growth for FY19, volumes need to grow more than 5 per
cent in the quarter ending March.

Ashok Leyland’s volumes increased 9 per cent to 19,741 units in January. This
means it must sell more than 43,000 units in February and March.

Historical data shows sales volumes in March are typically 3,000-3,500 units higher
than in January  ..

MAJOR PLAYERS IN THE INDUSTRY (2019-20)

New Delhi: Hinduja flaghip firm Ashok Leyland on Saturday reported 56 percent
decline in total commercial vehicle sales at 4,775 units in July.

The company had sold 10,926 in the same month last year, Ashok Leyland said in a
statement.

Domestic sales stood at 4,282 units as against 10,100 units in the year-ago month,
down by 58 percent, it added.
SWOT REPORT
Ashok Leyland Limited - Strategy and SWOT Report, is a source of comprehensive
company data and information. The report covers the company’s structure,
operation, SWOT analysis, product and service offerings and corporate actions,
providing a 360˚ view of the company.

Features:
Detailed information on Ashok Leyland Limited required for business and competitor
intelligence needs
A study of the major internal and external factors affecting Ashok Leyland Limited in
the form of a SWOT analysis
An in-depth view of the business model of Ashok Leyland Limited including a
breakdown and examination of key business segments
Intelligence on Ashok Leyland Limited’s mergers and acquisitions (M&A), strategic
partnerships and alliances, capital raising, private equity transactions, and financial
and legal advisors
News about Ashok Leyland Limited, such as business expansion, restructuring, and
contract wins
Large number of easy-to-grasp charts and graphs that present important data and
key trends
Highlights:

Ashok Leyland Limited (Ashok Leyland or the company), the flagship company of
The Hinduja Group, is engaged in manufacturing and marketing of commercial
vehicles. Its product portfolio includes trucks, buses, defense vehicles, and engines.
The company primarily operates in Asia. It is headquartered in Chennai, India and
employed 14,668 people as on March 31, 2013. The company recorded revenues of
INR124,812 million ($2,284.1 million) during the fiscal year ended March 2013 , a
decrease of 3.3% over FY2012. The operating profit* of the company was
INR4,956.8 million ($90.7 million) during FY2013, a decrease of 45.1% compared to
FY2012. The net profit was INR4,337.1 million ($79.4 million) in FY2013, a decrease
of 23.4% compared to FY2012. *operating profit adjusted for finance cost. Note:
figures are rounded off.

Reasons to Purchase:
Gain understanding of Ashok Leyland Limited and the factors that influence its
strategies
 Track strategic initiatives of the company and latest corporate news and
actions
 Assess Ashok Leyland Limited as a prospective partner, vendor or
supplier
 Support sales activities by understanding your customers' businesses
better
 Stay up to date on Ashok Leyland Limited’s business structure, strategy
and prospects
STP

COMPANY STAGE ON PLC

1 PRODUCT
2 Ashok Leyland is known for its products
3 What is a Product? A product is anything that can be offered to a market to satisfy
a want or need, including physical goods, services, experiences, events, persons,
places, properties, organizations, information, and ideas.
4 Figure 12.1 Components of the Market Offering Attractiveness of the market
offering Value-based prices Product features and quality Services mix and quality
5 Figure 12.2 Five Product Levels
6 Product Classification Schemes Durability Use Tangibility
7 Durability and Tangibility Nondurable goods Services Durable goods
8 Consumer Goods Classification Convenience Unsought Shopping Specialty
9 Industrial Goods Classification Materials and parts Supplies/ business services
Capital items
10 Developing products for rural markets Products should be designed keeping in
mind the rural conditions Packaging is one of the key drivers of success in rural
areas Issue of transfer and storage: Rugged packing The issue of affordability:
small-unit packs Brand elements should be decided keeping in mind rural consumers
11 Product Line and Product Mix Product Item –A specific version of a product
Product Line –A group of closely related product items viewed as a unit because of
marketing, technical, or end-use considerations Whole Milk Skim Milk 2% Milk
12 Product Mix –The total group of products that an organization makes available to
customers –Width of product mix The number of product lines a company offers –
Depth of product mix The average number of different products in each product line
13 The Concepts of Product Mix Width and Depth Applied to Selected U.S. Proctor &
Gamble Products FIGURE 10.1 Source: Reprinted by permission of Proctor &
Gamble.
14 Line Stretching Down-Market Stretch Up-Market Stretch
15 Product Life Cycles and Marketing Strategies Product Life Cycle –The
progression of a product through four stages: introduction, growth, maturity, and
decline. MP3s DVDs CDs Cassettes LP records
16 The Four Stages of the Product Life Cycle FIGURE 10.2
17 Claims of Product Life Cycles Products have a limited life Product sales pass
through distinct stages each with different challenges and opportunities Profits rise
and fall at different stages Products require different strategies in each life cycle
stage
18 The Product Life Cycle Introduction –The initial stage of a product’s life cycle—its
first appearance in the marketplace—when sales start at zero and profits are
negative –Why new products fail Lack of resources, knowledge, and marketing skills
to successfully launch the product High pricing to recoup research and development
costs
19 Strategies at various stages of PLC Introduction Build sales by expanding market
for the product Heavy expenditure on promotion Stimulate trial Attract distribution
channel partners Prices high or low depending on imminent competition Product Life
Cycle (Contd.)
20 The Product Life Cycle (cont’d) Growth –The stage of a product’s life cycle when
sales rise rapidly and profits reach a peak and then start to decline More competitors
enter the market Product pricing is aggressive Brand loyalty becomes important
Gaps in market coverage are filled Promotion expenditures moderate Production
efficiencies lower costs
21 Growth Customers aware of the product Build sales and market share by building
brand preference Segmentation emerges Product redesigned to create
differentiation Promotion lays stress on the benefits of the differentiated product
Focused competitors emerge Distribution will be widened to serve new segments.
Product made available in different retail formats as customers of different segments
buy differently Product Life Cycle (Contd.)
22 Maturity –The stage of a product’s life cycle when the sales curve peaks and
starts to decline and profits continue to fall Intense competition Emphasis on
improvements and differences in competitors’ products Weaker competitors lose
interest and exit the market Advertising and dealer-oriented promotions predominate
Distribution sometimes expands to the global market –Strategic objectives for
maturity stage Generate cash flow Maintain market share Increase share of
customer
23 Maturity Market does not grow in this stage Sales only at the expense of
competition Focus on ensuring repeat purchases Strong brand helps fight
competition Maintaining brand loyalty, stimulate repeat purchases Intense
competition, often price wars Company should focus on strengthening its brand by
differentiation Lasts for a long time Companies should set realistic growth rates Low
cost manufacturing and marketing infrastructure Product Life Cycle (Contd.)
25 Decline –The stage of a product’s life cycle when sales fall rapidly Pruning items
from the product line Cutting promotion expenditures Eliminating marginal
distributors Planning to phase out the product –Strategic choices Harvesting the
product’s remaining value Divesting the product when losses are sustained and a
return to profitability is unlikely
26 Decline Anticipate the impending decline in sales Analyze changing customer
requirements Exit immediately / gradual withdrawal / Exploit brand loyalty Product
Life Cycle (Contd.)
27 Uses of PLC Emphasizes the need for product planning Planning for competition
Products have limited life cycle Plan for the future as growth phase will end Adapt
marketing strategies as market and competitive conditions change Product Life
Cycle (Contd.)
28 Limitations of PLC Not all products follow the classic S- shaped PLC curve PLC is
the result of marketing activities, and is not the cause of variability in sales Duration
of PLC stages is unpredictable Strict adherence to PLC can lead a company to
misleading objectives and strategy prescriptions Product Life Cycle (Contd.)
29 Johnson & Johnson Emphasizes New Product Development
30 Categories of New Products New-to-the-world Cost reductions New product lines
Additions Improvements Repositionings
31 Moser Baer has moved from making optical storage media to selling home
entertainment
32 The World’s Most Innovative Companies Apple Google Toyota General Electric
Microsoft Procter & Gamble 3M Walt Disney IBM Sony Wal-Mart Honda Starbucks
Target BMW Samsung
33 Seven Notions of Innovation See the future through the eyes of your customer
Intellectual property and brand power are key assets Use digital technology to create
tools for customers Build a championship team Innovation is a state of mind Speed
is critical, so push your organization Partner up if you’re not the best
34 The New Product Development Decision Process
35 Mahindra and Mahindra followed a thorough product development process for
‘Scorpio’
36 Ways to Find Great New Ideas Run informal sessions with customers Allow time
off for technical people to putter on pet projects Make customer brainstorming a part
of plant tours Survey your customers Undertake “fly on the wall” research to
customers
37 More Ways to Find Great Ideas Use iterative rounds with customers Set up a
keyword search to scan trade publications Treat trade shows as intelligence
missions Have employees visit supplier labs Set up an idea vault
38 Drawing Ideas from Customers Observe customers using product Ask customers
about problems with products Ask customers about their dream products Use a
customer advisory board or a brand community of enthusiasts to discuss product
39 Idea generation Look outside current markets Modify product form Question
conventional price and performance relationships Imagine unarticulated customer
needs rather than simply following them Examine competitors’ products at frequent
intervals Retailers as a source of ideas for NPD Customers as a source of ideas for
NPD Utilize MR effectively Managing The Innovation Process (Contd.)
40 Idea screening Evaluate commercial worth of ideas Use criteria to evaluate
attractiveness of market for the proposed market Basis such as return on assets,
sales growth etc. Idea for NPD should be in alignment with the company’s objectives
and competencies Should have reasonable chances of success
41 Concept testing Each basic product idea can be expanded into several product
concepts Each product concept can be compared by testing with target customers
Product concept is a particular combination of features, benefits, and price Allows
views of customers to enter the NPD process at an early stage Use research to
gather customer opinions
42 Business analysis Estimates of sales, cost and profits Identifies the product target
market, its size, and projected product acceptance over a number of years Study
various prices and their implications on sales revenues Conduct sensitivity analysis
Estimate revenues and profits to justify the expenses of development and marketing
43 Product development New product concept is developed into a physical product
Multi-disciplinary project teams established Product testing focuses on the functional
aspects of the product and consumer acceptance R&D focuses on functional
aspects of product and marketing keeps the project team aware of psychological
factors
44 Products set up to fail at this stage: Developers become their own during this
stage Developers are wary of showing their incomplete designs to other people in
the organization Both customer needs and technologies are likely to change during
the development process itself A description of the product can never match the
physical product in eliciting real reactions of customers A company should be willing
to do ‘anything’ to increase the probability of success of a new product
45 Market testing Simulated market test Launch the new product in a limited way
Key success indicators such as penetration and repeat purchase can be ascertained
Launch of new product in one or few geographical areas chosen to be representative
of its intended market Facing competition in retail outlets Information provided by test
marketing facilitates the go / no go national launch decision
46 Commercialization and diffusion of innovation Diffusion is how a new product
spreads throughout a market over time Buyer at different stages of buying readiness
In initial phase of launch target customers who are more likely to buy the new
product than others Adoption slower if company targets complete market initially
47 What is Adoption? Adoption is an individual’s decision to become a regular user
of a product.
48 Stages in the Adoption Process Awareness Interest Evaluation Trial Adoption
49 Adopter Categorization
50 Innovators: Most likely to buy the new product Early adopters: Set of customers
who buy the product next Early and late majorities form the bulk of the customers
Laggards are tradition bound Diffusion of innovation categories play crucial role in
the choice of target markets Key is to understand the characteristics of the innovator
and early adopter categories and target them at launch
51 Adopter categories can provide basis of segmenting the target market Diffusion
curve linked to the product life cycle Characteristics of the product being launched
also affects diffusion rate Choice of marketing strategy to establish a differential
advantage to be made Product’s communicability affects adoption of new product
52 Characteristics of an Innovation Relative advantage Compatibility Complexity
Divisibility Communicability
53 Idea generation Look outside current markets Modify product form Question
conventional price and performance relationships Imagine unarticulated customer
needs rather than simply following them Examine competitors’ products at frequent
intervals Retailers as a source of ideas for NPD Customers as a source of ideas for
NPD Utilize MR effectively Managing The Innovation Process (Contd.)
54 Idea screening Evaluate commercial worth of ideas Use criteria to evaluate
attractiveness of market for the proposed market Basis such as return on assets,
sales growth etc. Idea for NPD should be in alignment with the company’s objectives
and competencies Should have reasonable chances of success Managing The
Innovation Process (Contd.)
55 Concept testing Each basic product idea can be expanded into several product
concepts Each product concept can be compared by testing with target customers
Product concept is a particular combination of features, benefits, and price Allows
views of customers to enter the NPD process at an early stage Use research to
gather customer opinions Managing The Innovation Process (Contd.)
56 Business analysis Estimates of sales, cost and profits Identifies the product target
market, its size, and projected product acceptance over a number of years Study
various prices and their implications on sales revenues Conduct sensitivity analysis
Estimate revenues and profits to justify the expenses of development and marketing
Managing The Innovation Process (Contd.)
57 Product development New product concept is developed into a physical product
Multi-disciplinary project teams established Product testing focuses on the functional
aspects of the product and consumer acceptance R&D focuses on functional
aspects of product and marketing keeps the project team aware of psychological
factors Managing The Innovation Process (Contd.)
58 Products set up to fail at this stage: Developers become their own during this
stage Developers are wary of showing their incomplete designs to other people in
the organization Both customer needs and technologies are likely to change during
the development process itself A description of the product can never match the
physical product in eliciting real reactions of customers A company should be willing
to do ‘anything’ to increase the probability of success of a new product Managing
The Innovation Process (Contd.)
59 Market testing Simulated market test Launch the new product in a limited way
Key success indicators such as penetration and repeat purchase can be ascertained
Launch of new product in one or few geographical areas chosen to be representative
of its intended market Facing competition in retail outlets Information provided by test
marketing facilitates the go / no go national launch decision Managing The
Innovation Process (Contd.)
60 Commercialization and diffusion of innovation Diffusion is how a new product
spreads throughout a market over time Buyer at different stages of buying readiness
In initial phase of launch target customers who are more likely to buy the new
product than others Adoption slower if company targets complete market initially
Managing The Innovation Process (Contd.)
61 Innovators: Most likely to buy the new product Early adopters: Set of customers
who buy the product next Early and late majorities form the bulk of the customers
Laggards are tradition bound Diffusion of innovation categories play crucial role in
the choice of target markets Key is to understand the characteristics of the innovator
and early adopter categories and target them at launch Managing The Innovation
Process (Contd.)
62 Adopter categories can provide basis of segmenting the target market Diffusion
curve linked to the product life cycle Characteristics of the product being launched
also affects diffusion rate Choice of marketing strategy to establish a differential
advantage to be made Product’s communicability affects adoption of new product
Managing The Innovation Process (Contd.)

FOUR PS
Marketing Mix Of Ashok Leyland

Product In Marketing Mix Of Ashok Leyland

The products manufactured by Ashok Leyland fall under these broad categories
 Buses: Passenger buses with capacity of 19-80 seating seats. The flagship
BEST buses and double Decker buses in Mumbai and the ibus are the
products of Ashok Leyland.
 Trucks: main focus on 16-25 ton range of trucks, with presence in all
segments from 7.5 tons to 49 tons. Axle lorry with custom-built cabin is very
popular in this segment.
 Light, medium and heavy commercial vehicles for various industrial and
transport utilities are made by Ashok Leyland.
 Defense: road mobile launchers, protection armored vehicles, army trucks etc
are the flagship products in this segment.
 Power Solutions
Place In Marketing Mix Of Ashok Leyland
The products are exported to various countries like Ghana, Bangladesh, and Sri
Lanka etc and with various joint ventures in different countries the brand Ashok
Leyland has made a global presence. The main manufacturing units across India are
in Ennore and Hosur (Tamil Nadu), Alwar (Rajasthan) and Pantnagar (Uttarakhand).
The units are highly specialized with well trained technicians and engineers who
make sure a flawless vehicle is delivered at the showroom and ensure proper after
sales service is provided to the customer.
Price In Marketing Mix Of Ashok Leyland
In the commercial vehicles segment the major competitor for Ashok Leyland
is Tata Motors. For example Ashok Leyland trucks are in the price range of Rs 13
lacs and Rs 16 lacs in two variants particular whereas similar trucks from
international manufacturer Volvo are slightly higher in price at Rs 14.25 lacs and Rs
17.85 lacs.
As the trucks and buses have long usage life like 15-20 years minimum what gets
essential is the maintenance cost which can be minimal if the quality of product is
good. So automotive manufacturers like Ashok Leyland if have slightly higher price
on the product with respect to competitors then this assures you the quality and
future savings on the maintenance aspect.
Promotion In Marketing Mix Of Ashok Leyland
The brand’s image is built by years of hard work of thousands of employees
delivering quality products in the automotive industry. But in this competitive world to
stay in the market and protect market share, a brand needs some other marketing
strategies.
After over six decades of their business Ashok Leyland named  Mahendra Singh
Dhoni as the brand ambassador. For the first time Ashok Leyland roped in
some celebrity for their multimedia advertisement campaign across
all markets addressing all the segments. And the rival company Volvo used the
similar strategy by getting the golfer Jeev Milkha Singh as the brand ambassador for
itself in India.
The values that the promoters have invested in the business are truly revealed by
the patronage that Ashok Leyland has and they truly reflect to be the son of the soil.
Shares

Ashok Leyland – Addressing market challenges with innovation

Living up to its tag of being an innovator and a trend-setter in the Indian CV industry,
Ashok Leyland had introduced a 16-wheeler rigid truck in 10×2 configuration – the
4123 – towards the end of 2018, a product that included patents and promised to
deliver a unique value proposition for customers including much higher profitability.
 We met Mr. Anuj Kathuria, President – Global Trucks, Ashok Leyland, to get
exclusive insights about the new product, along with updates on market sentiments,
AL’s readiness for BS-VI, and more.

Mr. Anuj Kathuria, President – Global Trucks, Ashok Leyland

Excerpts:
How are the sentiments in the CV industry at present? What impact are the new
axle.load norms having on the market?
We have seen a dip in market sentiments since Q3 FY19 mainly due to liquidity
crunch, axle load changes and rising fuel prices. The fuel prices have stabilized a bit
and cash flow in the market is better; on the axle load side, July to October was
mainly spent in understanding and adapting to the new norms, post which it starting
reflecting on vehicle sales; now, we are seeing a different type of impact on the
market, not on sales, but on the type of vehicles that are in demand; the sweet spot
has shifted from 14-wheelers to 12-wheelers and also to 16-wheelers.
The hub & spoke model is maturing further, driven by GST; demand is shifting to
ICVs on one side and higher tonnage vehicles on the other. We had anticipated most
of this when the new axle load norms were announced. But, the rise in axle load
capacity need not necessarily translate to reduced vehicle sales because the total
demand in the market is not constant, it is growing. As road transport becomes more
cost-competitive and efficient, as compared to rail, and with road infrastructure
getting better, the demand for trucks is bound to go up.
 COVID IMPACT
The total sales, including exports, declined 89 per cent 1,420 units compared to
13,172 units in the same period last year. The total M&HCV sales, including exports,
declined 97 per cent to 266 units, compared to 8,946 units in May, 2019. During the
month, no M&HCV buses were sold, while there were 1,564 units sold same month
last year.

Ashok Leyland joins hands with health authorities to tackle COVID-19

crisis

Synopsis
The commercial vehicle major has aligned itself with the Department of Health and
Family Welfare for a slew of initiatives, Ashok Leyland Ltd said in a statement. The
Chennai-based firm is supplying 3 ply masks, N95 masks, disposable gloves, liquid
handwash, sanitisers, body suits for health service personnel, it said.

A Hinduja Group flagship firm Ashok Leyland NSE 1.19 % on Tuesday said it is
actively working with government authorities in tackling COVID-19 (coronavirus)
pandemic.

The commercial vehicle major has aligned itself with the Department of Health and
Family Welfare for a slew of initiatives, Ashok Leyland Ltd said in a statement.

The Chennai-based firm is supplying 3 ply masks, N95 masks, disposable gloves,
liquid handwash, sanitisers, body suits for health service personnel, it  ..

COMPETITIVE ADVANTAGE
Commercial vehicles manufacturer Ashok Leyland aims to become a leader in both
the Medium and Heavy Commercial Vehicles (MHCV) and light commercial vehicles
(LCV) segments in the next 3-5 years. One of the main reasons for this is the company
has launched its Bharat Stage (BS) IV trucks using inhouse technology and can
convert BS-III vehicles to BS-IV at a much lower cost than competitors.

Ashok Leyland's new technology named 'iEGR' which incurs an additional

cost of only Rs 20,000 in converting a BS-III engine to BS-IV. While
competitors use SCR technology that costs Rs 60,000-80,000 for the same,
according to a Philip Capital report.
The technology has less electronic components, hence it is more suited to
Indian roads with lower maintenance. Besides this, it has 10% higher fuel
efficiency in comparison with its peers. While defence forms a small proportion of
Ashok Leyland’s revenue (about 3%), it expects strong growth in this domain, said
Philip Capital analyst Dhawal Doshi and Nitesh Sharma in the report. In recent years,
the company has launched new products (including 10x10 trucks for carrying
missiles, bullet‐proof vehicles, mine‐protected vehicles, mounted‐gun vehicles) that
have started gaining good traction.

Its order book in this segment has been rising. The company sees its defence
revenues growing by 10 times in the next five years.
Apart from defence vehicles, it sees its exports and after-market sales
segments where Ashok Leyland sees robust growth. “It has been seeing
strong traction in exports and now dominates 60% share (up from 20%) in the
Middle East; it is a leader in Ukraine. To strengthen its export footprint, Ashok
Leyland will set up a plant in Kenya and the Ivory Coast over the next two
years,” said the report.

Management Analysis of Ashok Leyland Ltd:

The salary of directors, board members, and senior management for the last
10 years is summarized below. It is in the range of 1 to 2%; however, it goes up
to 7% in 2019 as stock options were exercised.
Still the total management salary 7% of net profit is well below statutory limits
of 11% based on the net profit of 2019. It includes a major amount of options
exercised.
Regards,
Jai Singh Baghel

Vision Statement
At Ashok Leyland, Corporate Social Responsibility starts with a belief that what you
do is important to the society.We place a high value on listening to our communities
and strive not just to be a good neighbour, but a global corporate citizen.We operate
in ways that honour our values and respect the people, communities and natural
environment in which we work and live. Through authentic relationships, we are
building better, stronger and more sustainable communities. People, Planet and
Profit for all stakeholders especially our customers is at the core of Ashok Leyland
which resonates with our Philosophy of ‘Aapki Jeet, Hamari

SUCCESS
 About this growth Vinod K Dasari, Managing
Director of Ashok Leyland said, “Over the last seven decades, the company
has grown exponentially. The company has achieved many patents for its
innovations. Five years ago, our market cap was Rs 3000 crore. A few months
ago, it was 45,000 crore