Ashok Leyland share price rallies 3.5%, scaling 52-week high; check its Budget 2026-27 expectations and other details

The stock advanced as much as 3.53% to hit an intraday high of ₹197, also its 52-week high on the NSE.

Ashok Leyland MD and CEO Shenu Agarwal said on Thursday, January 22, that the government should consider offering incentives for scrapping old trucks in the upcoming Budget (Union Budget 2026-27) to help owners replace old units with new ones, stimulate fresh demand, and curtail air pollution.

A little detail

Many old trucks are highly polluting, unsafe, and inefficient, and truck owners often keep using them because buying new vehicles is expensive. So, if the government offers incentives—such as cash benefits, tax rebates, lower registration fees, or discounts on new trucks—owners would be more willing to scrap old vehicles and replace them with newer ones.

What Ashok Leyland said

The company, which re-introduced the Taurus and Hippo range of heavy-duty trucks on Thursday, stated that owners realise that the new trucks are better in terms of productivity and need initial support to move on to the new units.

"GST 2.0 has already provided one such trigger by boosting consumption-led freight demand. Another could be a well-designed scrappage incentive scheme," Agarwal told reporters, as reported by PTI.

While stressing that scrappage should not be mandatory, Agarwal noted that the government-led incentives linked to vehicle tonnage could encourage faster replacement.

"Smaller trucks could attract smaller incentives, while larger tonnage vehicles could get bigger support. This would benefit both customers and the industry," Agarwal said.

Agarwal noted that the government is promoting scrappage by establishing vehicle scrapping facilities.

"So the government is creating that ecosystem, but initially, some kind of a push would be required for people to get into this habit of scrapping the trucks," Agarwal opined.

Other benefits

Apart from environmental benefits, newer trucks are expected to lower logistics costs by carrying larger cargo at higher speeds with reduced emissions, Agarwal added.

"The average age of India's truck fleet has crossed 10 years, compared to the historical seven to eight years," the CEO said.

Ashok Leyland: Plans ahead

On investment plans, the CEO noted that the Hinduja flagship has enhanced its annual capex to ₹1,000 crore from ₹300-₹400 crore earlier.

Agarwal noted that the company plans to set up a new facility in Saudi Arabia with an initial production capacity of approximately 10,000 units.

"We are working on a total blueprint of the Saudi plan. We have got all the necessary approvals from the local government. We are almost at the verge of identifying the location," the CEO added.