Ashok Leyland to Boost Electric Unit with ₹500 Crore Investment

Key Highlights:

• Ashok Leyland plans to invest ₹500 crore in its electric unit's parent company, Optare PLC, in Q4 FY25.
• The company will also invest ₹200 crore in Hinduja Finance to improve financial stability.
• Dheeraj Hinduja said these investments will help Switch Mobility expand further.
• Switch Mobility had over 1,800 electric bus orders, including a 100-bus export deal with Mauritius.
• Ashok Leyland’s expected capital spending for FY25 is projected to be ₹800-1,000 crore.

Ashok Leyland, a leading commercial vehicle company based in Chennai, plans to invest ₹500 crore in Optare PLC, the parent company of its electric mobility unit, Switch Mobility. This investment will be made in the fourth quarter of FY25.

Additionally, the company will put ₹200 crore into Hinduja Finance to strengthen its financial stability. This information was shared by the company’s management on Wednesday.

The move comes nearly a year after Ashok Leyland approved an equity infusion of Rs 1,200 crore in Switch Mobility. At the time, the company decided to postpone obtaining external money, claiming that its internal finance would be sufficient to meet its demands for the foreseeable future.

Leadership Insights

Dheeraj Hinduja, Executive Chairman of Ashok Leyland, explained during a post-earnings call that these investments will help Switch Mobility continue its growth and expansion plans. He also outlined the rationale behind these capital allocations.

Switch Mobility, Ashok Leyland's electric vehicle unit, had an order book of over 1,800 electric buses by the end of Q3 FY25, including a 100-bus export contract from Mauritius. The company's electric light commercial vehicles (e-LCVs) have been steadily increasing, with monthly sales topping 100 units.

Regarding broader capital spending, Ashok Leyland's leadership stated that the capex for the upcoming fiscal year is still being reviewed. However, preliminary projections imply that the company's overall capital expenditure in FY25 will range between Rs 800-1,000 crore.

About Switch Mobility

SWITCH Mobility is a leading company in electric mobility, and it's a part of the Hinduja Group. The company focus on making electric buses and light commercial vehicles. The company was formed by combining Ashok Leyland’s engineering skills with Optare’s creative design. SWITCH is dedicated to providing eco-friendly transport solutions for both city and intercity travel. 

They have manufacturing plants in both the UK and India, and they’ve already deployed over 1000 electric vehicles worldwide, covering over 150 million kilometers. SWITCH Mobility is all about innovation and quality, pushing the future of sustainable transport.

Also Read: Electric Buses Sales Report January 2025: Switch Mobility Emerges as Top Choice for E-Buses

CMV360 Says

Ashok Leyland’s investments show that the company want to grow its electric vehicle business. Putting more money into Switch Mobility will help make more electric buses and expand sales. The 100-bus order from Mauritius is also a good sign of demand from other countries. It seems like Ashok Leyland is planning ahead for the future to stay competitive in the electric vehicle market.