CV Sector Rebound: Tata Motors vs Ashok Leyland Growth

The commercial vehicle sector is bouncing back strong. After a sluggish start to 2025, both Tata Motors and Ashok Leyland posted impressive growth in the December quarter. Government GST cuts and infrastructure spending are driving the revival.

What Sparked the Turnaround

The central government reduced GST on trucks, buses, and commercial vehicles from 28% to 18% on September 22, 2025. The RBI also cut loan and credit rates to boost economic activity. These measures worked. Ashok Leyland's sales grew 9% in the September quarter and jumped 25.4% in the December quarter.

Ashok Leyland: LCV Sales Jump 30%

Ashok Leyland sold 58,412 vehicles in the December 2025 quarter, up 25.4% year-on-year. Light commercial vehicles like the Dost and Saathi drove this growth with a 30% sales jump. The company maintained over 30% market share in the medium and heavy commercial vehicle segment.

Revenue rose 21.7% to ₹11,534 crore. Operating profit margin improved to 13.3%. Net profit hit an all-time high of ₹796 crore, despite a one-time ₹308 crore hit from the new labour code.

Tata Motors: Heavy Truck Sales Lead the Way

Tata Motors sold 115,577 vehicles in the December quarter, up 20.7% year-on-year. Heavy commercial vehicle sales jumped 23%, driven by the Prima and Signa ranges. Exports surged 70% during the quarter. Domestic market share increased to 35.5% from 34.5% in the previous quarter.

Revenue grew 19.7% to ₹20,404 crore. Operating profit margin expanded to 11.7%. Net profit fell 60% to ₹561 crore due to exceptional expenses of ₹1,545 crore, including ₹574 crore for the new labour code.

Both Companies Launching New Models

Tata Motors recently launched 17 new trucks across different segments. The company also acquired Italy's Iveco commercial vehicle business for ₹38,200 crore. Once approved, this will expand Tata's presence in Europe, the Middle East, and Africa.

Ashok Leyland launched the new HIPPO range covering light to heavy commercial vehicles and the TAURUS range for the heavy segment. Benefits from these launches will roll out over the next few quarters.