Ashok Leyland reported record revenue and profit for the June-ended quarter with revenue from operations rising 10% year-on-year to ₹9,634 crore and net profit climbing 3% to ₹609 crore.

However, higher commodity costs weighed on profitability, pulling the EBITDA margin down to 10.1% from 11.1% a year earlier despite record first-quarter commercial vehicle sales.

On a consolidated basis, which includes the group’s financial services businesses, revenue from operations rose about 12% year-on-year to ₹13,070 crore,profit before tax climbed 7% to ₹950 crore and profit after tax rose about 2% to ₹668 crore.

Chairman Dheeraj Hinduja, in a statement said, demand across key segments remained robust and that government initiatives such as Parivartan would accelerate fleet modernisation while strengthening the long-term growth prospects of the commercial vehicle industry.

The company reported its “highest-ever first-quarter” commercial vehicle sales of 48,763 units, led by strong growth in the light commercial vehicle segment. Medium and heavy truck sales also grew during the quarter, although bus sales were affected by state elections in key markets and the company’s decision to avoid unprofitable tenders, management said during the post-earnings briefing.

Exports declined to 2,461 units from 3,011 units due to disruptions caused by the conflict in West Asia. The company said overseas volumes have started recovering and expects international operations to perform better than last year.

The company said it plans to spend around ₹1,000 crore on capital expenditure in FY27, mainly on new product and technology development, while ruling out any immediate capacity expansion.

It also said Switch Mobility India, its electric bus business, is now financially independent. The Chennai-based auto major also proposed an investment of up to £25 million (around ₹325 crore) in Optare Plc, the U.K.-based holding company for the group’s electric mobility businesses, and said it will be used to repay loans and meet business requirements.

On the workforce front, management said Ashok Leyland employed about 30,000 people on its standalone rolls. Responding to questions on Artificial Intelligence (AI), the company said AI is being deployed across manufacturing, sales and after-sales operations to improve productivity rather than reduce headcount.

“Our first goal from deployment of AI is to increase our capability and effectiveness rather than reduce the headcount,” the company said, adding that AI tools are being used to strengthen workshop diagnostics, improve sales effectiveness and provide customers with greater transparency on vehicle health, repair costs and service processes.