Commercial vehicle manufacturer Ashok Leyland Ltd is banking on a robust defence order pipeline and continued growth in its subsidiaries as it has been delivering 20% growth in defence business over the last few years.
The flagship company of the Hinduja group said its defence business delivered more than 20% growth in FY26, with revenues crossing ₹1,200 crore, including contributions from subsidiaries. The company’s defence order book has now crossed ₹1,500 crore, providing strong visibility for future growth.
“We had a fabulous FY26 in defence, more than 20% growth. Revenues increased to ₹1,200 crore-plus, including that of the subsidiary. Our order pipeline in defence is the strongest ever and is already above ₹1,500 crore,” said Managing Director & Chief Executive Officer Shenu Agarwal during the earnings call.
“We are very sure that it is not just this year, but at least for the next two to three years, we will show very strong growth,” he added.
Capex and subsidiary investments
The company plans to spend between ₹750 crore and ₹1,000 crore on capital expenditure during FY27, after incurring around ₹1,000 crore in FY26.
“Last year, we incurred about ₹1,000 crore. So next year also, the plan would be to incur about ₹750 crore to ₹1,000 crore on the capital expenditure side,” said President – Finance & Chief Financial Officer K.M. Balaji.
Balaji said additional investments would be made in subsidiaries based on their growth requirements. Hinduja Leyland Finance (HLF), Hinduja Housing Finance (HHF) and OHM Mobility are expected to require capital support as they expand operations.
According to Agarwal, investments in subsidiaries during the fourth quarter stood at ₹371 crore, mainly towards repayment of loans in off-tier entities. Total investments during FY26 amounted to ₹387 crore.
EV and finance arms perform strongly
Electric vehicle subsidiary Switch Mobility India reported a net profit of over ₹100 crore in FY26 and retained leadership positions in electric buses and the 2-4 tonne electric light commercial vehicle segment.
Switch delivered 1,530 electric buses during the year, up 238% year-on-year, and 1,600 electric LCVs, up 56%. Its order book stood at 1,600 units at the end of FY26.
OHM Mobility expanded its operational fleet to more than 1,400 electric buses.
HLF reported a 24% increase in assets under management (AUM) to around ₹59,000 crore and a 20% rise in profit after tax to ₹491 crore. HHF recorded a 15% increase in AUM to about ₹16,000 crore, while PAT rose 4% to ₹387 crore.
Both finance businesses maintained healthy asset quality, with consolidated net NPAs of around 1.4%. The proposed reverse merger of HLF with NBL Ventures is progressing as planned and is expected to be completed this quarter or the next.