Hinduja Group-promoted Ashok Leyland, India's second-largest maker of trucks and buses, has entered into a Memorandum of Understanding (MoU) with Union Bank of India (UBI), to extend retail finance facility to Ashok Leyland's commercial vehicle customers as well as for their dealers' inventories.

Under the arrangement, the bank will offer loans to Ashok Leyland's customers and dealers at 100 basis points lower than its PLR (Prime Lending Rate) as against their PLR for other commercial vehicles.

Earlier, Ashok Leyland has signed similar MoUs with State Bank of India, State Bank of Patiala, Jammu & Kashmir Bank, Corporation Bank, Bank of Baroda and Punjab National Bank, to fully utilize the vast networks of Public Sector Banks to service the entire value chain from wholesale to retail, for mutual benefit.

Nishant Jain, Director, TradeSwift Broking is of the view that one should buy Ashok Leyland for a target of Rs 35 with a stoploss of Rs 29.

The scrip of the company today closed with a gain of 5% at Rs 30.75 on BSE. It touched an intraday high and low of Rs 31 and Rs 29.