Ashok Leyland shares decline 3% after promoter entity pledges shares worth over ₹6,000 crore

One of the promoters of Ashok Leyland, Hinduja Automotive Ltd., announced in an exchange filing on Wednesday evening, that it has created a pledge on nearly 30% of its holdings.

At the current market price of Ashok Leyland, that stake is valued at over ₹6,400 crore. As of December 31 last year, Hinduja Automotive held a 35% stake in the company.
Additionally, the company announced that it will be shutting shop for its EV arm Switch Mobility’s manufacturing and assembly unit in the UK. The company cited economic uncertainties and slow transition to EVs in public transport in the UK and Europe as some of the key triggers.
While Switch India is expected to turn positive on an Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) basis in the current financial year and PAT positive during financial year 2026, the UK business was turning out to be a drag.

Nomura called the decision to shut UK operations of Switch a step in the right direction. The brokerage has a “buy” rating on Ashok Leyland with a price target of ₹250.

Morgan Stanley believes that the Switch decision will reduce cash burn and will also bring economies of scale to India. It added that it does not value Ashok Leyland’s EV business in its base case estimates. The brokerage is “overweight” on the stock with a price target of ₹284.

Out of the 44 analysts that have coverage on Ashok Leyland, 36 of them have a “buy” rating, while four each have a “hold” and “sell” rating respectively.

Shares of Ashok Leyland had ended 2.1% higher on Wednesday after it denied reports that it is not in the race to acquire the promoter stake of SML Isuzu.