To raise up to Rs 600 cr debt this fiscal: Ashok Leyland

Hinduja flagship company Ashok Leyland today said it plans to raise up to Rs 600 crore in long-term debt this fiscal to fund its capital expenditure plans till 2011-12.

"This fiscal, the fund raising plan is only through debt. We had planned to raise Rs 500-600 crore through debt and already we have raised about Rs 360 crore," Ashok Leyland CFO K Sridharan told reporters here.

Another Rs 200 crore will be raised before the end of the year, he said, adding that the fund would be utilised mainly for capital expenditure till the next fiscal.

These are long-term debts of 5 years duration, he said, adding that Ashok Leyland's debt will go up to Rs 2,700 crore by the end of this fiscal from around Rs 2,500 crore at present.
    
"Capex for this fiscal will be Rs 1,000 crore and there will be another Rs 1,000 crore in the next fiscal," he said.
    
The amount will be mainly used for Ashok Leyland's joint venture with Nissan for light commercial vehicles and another one with John Deere Construction & Forestry for construction equipment, he said.
    
In addition, the funds would also be used for producing the 'Neptune' range of engines for Ashok Leyland's new 'U Truck' range of commercial vehicles.
    
The Neptune series of engines will have a power ranging from 160 to 353 horse power and will be produced at the company's Pantnagar and Ennore facilities, he said.
    
"By the end of the next fiscal, we will be producing 1,00,000 units of Neptune engines," Sridharan said.
    
Asked about the sales forecast for the ongoing fiscal, he said the company is expecting about 40 per cent growth.
    
"Last year, the total sales were about 64,000 units and we expect to cross 90,000 units this year," he said.
    
Sridharan also said the company will be gradually increasing output from its Pantanagar facility so that it can reach full capacity utilisation of 4,000 units per month by the end of the next fiscal.
    
"By the end of this fiscal, we expect output from the Pantnagar plant to be around 2,500 units per month, up from 1,000 units per month currently," he said.
    
Ashok Leyland manufactures its entire range of heavy duty vehicles at the Pantnagar plant. The firm currently has an installed capacity of 1.5 lakh units across its seven plants, including Ennore, Hosur, Alwar, Bhandara and Pantnagar.