ACE's Q2FY21 performance was outright better than our estimates and management guidance. Underperformance of crane segment was largely due to unexpected supply chain constraints faced by the company due to which ACE lost 10-15% of revenue during the quarter. Nonetheless, upbeat numbers in material handling & agri equipment segment aided overall margins and bottomline. Revenue for the quarter was at | 268.3 crore, flat YoY. Gross margins fell ~180 bps YoY due to higher input costs. However, cost rationalisation efforts led to a decline of 15% & 27% in employee & other...

Action's Q1FY21 performance was dire as the company registered a loss. Crane segment (~70% of revenue in FY20) was the worst hit due to standstill in infrastructure activities. Revenue for the quarter was at | 100.9 crore, down 65.6% YoY. Crane segment revenue was at | 49.8 crore, down 77% YoY. Total crane volumes were at ~299 units vs. ~1316 units in Q1FY20. Gross margins expanded ~160 bps YoY on account of lower input costs & trade purchases. However, unabsorbed fixed overheads led ACE to report an EBIDTA loss of | 3 lakh. On the expenses side, employee expenses...

Given the recent events, ACE is likely to face headwinds in the short to medium term on account of sluggish demand and low capacity utilisation. At present, ACE is trading at 6.5x FY22E EV/EVITDA, with most of the near term uncertainty priced in the stock. Going ahead, market leadership in the pick & carry' cranes (>60% market share) with a healthy balance sheet, foreseeable improvement in working capital, growing agri and construction equipment segment is expected to augur well for the company in the long term. However, short & medium term pain is expected to weigh on...

Action Construction (ACE) reported a weak Q3FY20 performance wherein topline, EBITDA, PAT de-grew 20.2%, 13.8%, 15.1%, respectively, YoY. Headwinds in the cranes, tractors and material handling segment led to topline de-growth. EBITDA margins expanded ~58 bps YoY to 7.7% largely on the back of lower input cost. Overall, EBITDA, PAT were at | 22.4 crore, | 12.6 crore, respectively. Softened demand for cranes led revenue of cranes segment to fall 21.2% YoY to | 196.4 crore driven by ~31% decline in volume sold to ~1211 units. Construction equipment grew 14.5% YoY while...

Demand pickup, new products to drive future growth A sharp slowdown in macro environment has impacted the sale of cranes, which contribute ~72% of ACE's topline and ~81% of overall EBIT, thereby resulting in weak operational performance for Q1FY20 as well. The company has been hit by higher inventory levels as it had expected the infrastructure and industrial markets to rebound post elections. However, markets have continued to remain sluggish. Inventory levels are expected to revert to normal levels over the next couple of quarters. On the positive front, there...

Action Construction (ACE) reported a weak Q4FY19 performance wherein topline, EBITDA, PAT de-grew 18.5%, 37.8%, 43.1% respectively, YoY. The topline mainly got impacted by cranes & tractors i.e. agri-equipment segment. EBITDA margins declined ~250 bps YoY to 7.9% largely due to impact of higher steel prices (COGS, up ~260 bps YoY) while higher employee expenses were offset by lower other operational expenses. Overall, EBITDA, PAT were at | 23.9 crore, | 12.2 crore, respectively. Softened demand for cranes led revenue for cranes segment down 15.1%...

Action Construction Equipment (ACE) reported a weak Q3FY19 performance wherein revenues grew ~30% YoY to | 362.6 crore mainly driven by robust growth in cranes & tractors i.e. agriequipment segment EBITDA margin fell ~250 bps YoY to 7.2% largely due to impact of higher steel prices (COGS, up ~460 bps YoY), offset by operational efficiencies due to incremental demand growth. EBITDA was at | 26 crore, down 4.1% YoY. PAT de-grew 9.4% YoY to | 14.9 crore Cranes segment recorded revenue of | 249.2 crore growing 34.6%...

EBITDA margins declined 70 bps YoY to 6.2% largely due to impact of higher raw material expense (+50 bps YoY), dollar appreciation (~15% of raw material costs are imported) and oneoff provision of | 4 crore. PAT grew 13% YoY to | 12.4 crore Cranes segment recorded revenue of | 246.3 crore growing 50.6% YoY driven by ~42% increase in volume sold to 1,624 units. Demand stayed strong for forklifts (235 units) and backhoe loaders (80 units) in Q2FY19. EBIT margins declined 76 bps YoY to 8.1% for the cranes segment. Revenue from the agri equipment...

ACCE is a leading manufacturer of mobile cranes (63% market share) and tower cranes (60%) in India. ACCE also caters to a large clientele base, (with over 15000 customers) which includes major Indian as well as international players such as Reliance, L&T;, BSES, BHEL, Gammon, NCC, Gujarat Ambuja, IISCO, Simplex, Coal India, etc & its products are used in sectors like infrastructure, construction, roads, engineering, coal mines, chemical and fertilizer plants, power stations, ports, heavy project engineering,...

Action Construction Equipment (ACE) reported a solid Q1FY19 wherein revenues grew ~78% YoY to | 336.2 crore partly driven by higher realisation profile, robust growth across all segments. EBITDA margin improved 300 bps YoY to 8.0% largely due to benefits of operating leverage as a result of higher capacity utilisation across segments. PAT grew ~4.4x to | 16.7 crore Cranes segment recorded revenue of | 245.7 crore growing 78.5% YoY driven by ~79% increase in volume sold to ~1,700...

Action Construction (ACE) reported a strong Q4FY18 wherein revenue grew ~60% YoY to | 367.5 crore driven by growth across all segments. EBITDA margin rose 643 bps YoY to 10.4% largely driven by higher capacity utilisation leading to benefit of operating leverage while PAT grew ~8.9x to | 21.5 crore FY18 revenues rose ~45% YoY to | 1087 crore, EBITDA grew over 2.3x to | 91.5 crore while PAT grew 3.5x to | 53.4 crore. Cranes segment recorded revenue of | 749 crore growing 51%...

Action Construction Equipment (ACE) with its established brand name ACE has expertise in manufacturing diverse product profile like cranes, loaders, forklifts, tractors and other construction equipment across India's agriculture, infrastructure and construction space. Buoyed by tailwinds in its operating segments, the company posted stellar numbers for the quarter. The 9MFY18 revenues grew at a robust pace of 32% YoY at ~| 737 crore while PAT grew 152% YoY at | 31.18 crore....

Action Construction Equipment (ACE) has reported its Q2FY18 results. The company managed a robust topline growth of 40% YoY. Positive operating leverage at play resulted in a higher than anticipated growth of bottomline at 144%. Segmental profits were led by the cranes segment and boosted by a turnaround in the agri equipment segment. Focussed on catering to anticipated demand Considering the recent robust operational performance delivered by the company, we revise our estimates higher for ACE across all segments....

571 units in FY16 to 846 units in FY17. This helped the company to augment its MHCE revenues by a significant 62.1% from 626 mn in FY16 to 1,015 mn in FY17, thereby posting an operational profit of 63 mn in FY17 vis-a-vis a loss of 7 mn in FY16....

Key argument: Excellent execution track record, Large equipment bank & minimal sub-contracting

enabled ACE to clock ~ 57.2 % growth in its EBITDA from 125 mn in H1FY16 to 197 mn in H1FY17. In spite of a slight rise in depreciation, mainly attributable to the ACE merger with ACE TC Rental Pvt Ltd and a fall in other income, the company has benefited from a low base as the...

Action Construction Equipment (ACE) is one of the leading material handling & construction equipment manufacturing companies in India. Its money spinner is its crane division which boasts a market share of ~ 60% in both mobile cranes & tower cranes segments. It also possesses manufacturing capabilities to make crawler cranes, truck mounted cranes, lorry loaders, backhoe loaders, vibratory rollers, forklifts & other construction equipment. It is an emerging agriculture equipment manufacturer as well where it produces & sells tractors, harvest combines, rice planters, balers & rotavators. Its production facilities are located in the industrial township of Faridabad. LKP Securities initiate coverage on ACE with a BUY rating and a 18 month price objective of ? 75.

Trendlyne has 1 report on ACE updated in the last year from 1 broker with an average target of Rs 75.