Material handling and logistics management which involve transportation of work pieces on production floor, are important aspects to manufacturing that affect productivity and efficiency. Tow vehicles that are manually driven are currently used for this purpose. These processes can be better performed through automation. Automated Guided Vehicle (AGV) is an apt solution. AGVs are unmanned autonomous vehicles that can be programmed to perform versatile tasks. AGVs available in market are imported and hence have high capital cost and increased lead time for spare parts. Proposed AGV is built with a capital cost that is less than half of existing AGVs. Its design is made indigenously, with most of its parts locally sourced. It can achieve a speed of 0.83m/s, with a pulling capacity of 1300kg. Its rechargeable batteries sustain four hours of continuous operation for one complete discharge. It has been tested and found to effectively replace tow vehicles.