Ifad Autos set to assemble Ashok Leyland vehicles
Ifad Autos will start assembling Indian Ashok Leyland-branded vehicles on Thursday at its new plant that set up at a cost of about Tk 75 crore in Savar.
The company's inroads in assembling will help it meet the growing demand for commercial vehicles.
Initially, Ifad Autos will assemble 1,000 commercial vehicles such as buses, trucks and pick-ups in the current fiscal year. The figure will go up to 3,000 vehicles in the next fiscal year, said a senior official.
The number will reach 10,000 by 2020, said Taskeen Ahmed, managing director of Ifad Autos. The company posted a notice on the subject on the website of the Dhaka Stock Exchange yesterday. The new plant will help Ifad offer assembled vehicles at prices lower than those of the imported ones, he said.
“The company's profitability will also increase,” said Ahmed, also the president of the India-Bangladesh Chamber of Commerce and Industry.
Ifad Autos' revenue stood at Tk 693.26 crore at the end of June 2016, up 37 percent over the previous year.
Ahmed said the local assembling will allow them to use locally produced automobile components.
“Gradually, we will move toward progressive manufacturing of commercial vehicles,” he said adding that the company aims to manufacture 20-25 percent of a chassis locally in the next few years.
Ifad, which had previously been Ashok Leyland's sole distributor in Bangladesh for about three decades, is now its strategic partner in the country.
Ashok Leyland is the second largest manufacturer of commercial vehicles in India, fourth largest manufacturer of buses in the world and 16th largest manufacturer of trucks globally, according to its website.
Ifad Autos, a unit of Ifad Group that has presence in fast-moving consumer goods to agro-products and chemicals, started its journey as a private enterprise in 1985 and has built a nationwide network with offices, dealers and showrooms.
The company was listed in the stockmarket in 2014 in order to carry out its expansion plans, especially setting up of the modern assembly plant in Savar.
Its net profit stood at Tk 58.59 crore at the end of June 2016 with re-stated earnings per share of Tk 3.98. That compares with Tk 37.85 crore in net profit and Tk 2.64 re-stated earnings per share a year ago.
Each share of the company traded between Tk 121.6 and Tk 127.7 before closing at Tk 123 on the premier bourse yesterday.
Sponsors hold 62.77 percent stakes in Ifad Autos, while institutional investors own 19.61 percent and the retail investors 17.61 percent.