In this post we will check Action Construction Equipment Ltd (ACE) share, their fundamentals, future view, company’s outlook, their financials, shareholding patterns etc , Based on company’s fundamentals and technical analysis, we will try to predict ACE share price target 2023,2024,2025 and 2030.
About Action Construction
Action Construction Equipment Ltd was incorporated in 1995. Company is engaged in the business of manufacturing and marketing of hydraulic mobile cranes, mobile tower cranes, material handling equipment like forklifts, road construction equipment like backhoe loaders, compactors, motor graders and agriculture equipment like tractors, harvesters, rotavators, etc.
Their IPO was come in 2006.
ACE Share Price Target 2023 based on technical analysis
On chart ACE share price trading near 320 level, share have bounced backed from its support level which is around 260, above the level of 330 we can see further upside, above 330 the first target for ace share would be 350 and above it second target would be 384.
Action Construction Share Price Target 2023
| Year | Action Construction Share Price in 2023 |
| 2023 | ₹350 to ₹384 |
Company Info
| Company Name | Action Construction Equipment Limited |
| Company Website | https://www.ace-cranes.com/ |
| Chairman and Managing Director | Vijay Agarwal |
| Market Cap (Cr.) | ₹ 3802 |
| 52 W High / Low | ₹ 355/175 |
| Stock P/E | 27.1 |
| Book Value | ₹ 68.8 |
| P/B (Price to Book Value) | 4.63 |
| Face Value | ₹ 2 |
| ROCE | 22.5% |
| ROE | 16.4% |
| Dividend Yield | 0.19% |
Business Overview:
Company operates mainly in four segments i.e. Cranes, Construction Equipment, Material Handling and Agri Equipment.
Market Leadership
The company is the India’s largest Pick & Carry cranes manufacturer with over 63% market share in the Mobile cranes segment and a majority market share of ~60% in Tower Cranes segment domestically.
It is also the 3rd largest manufacturer of forklifts behind Godrej and Kion in India.
Their product use:
Their equipment is used in sectors like Infrastructure, Construction, Power Projects, Ports & Shipyards, Dams, Metro Rail, Roads, Mining, Steel Industry, Engineering Industry, Railways, Cement, Petroleum, Defence, Chemicals & Fertilizer Plants, Warehousing, Logistics, Building Construction, and many more. Infrastructure sector includes power, bridges, dams, roads, and urban infrastructure development.
Key Highlights:
Manufacturing Facilities
Presently, the company has 4 manufacturing units with its main plant located in Palwal (Haryana) and 2 fabrication units and R&D unit located in Faridabad.
The company owns total industrial land of ~90 acres with only ~45% acres utilized.
- Its manufacturing capacity include :-
- Cranes – 9,000 units p.a.
- Agriculture equipment – 9,000 units p.a.
- Material handling equipment – 1,800 units p.a.
- Construction equipment – 1,500 units p.a.
International Presence
The company exports its products to 25+ countries globally which include Mexico, Argentina, South Africa, Kenya, Tanzania, Nigeria, Egypt, Sudan, Saudi Arabia, Yemen, Oman, Bangladesh, Nepal, Indonesia and other countries.
Sales Network
The company has a wide sales network with 100+ locations supported by 21 regional offices in India
- The Number of permanent employees on the rolls of the Company as on March 31, 2022 are 1184.
FINANCIAL PERFORMANCE REVIEW
Crane Division:
- Crane division contributes 67.72% to total turnover of the company.
- The Cranes division revenues increased by 39.71% to Rs 1104.02 crores in the year ended March 31, 2022 as against Rs 790.21 crores in the year ended March 31, 2021.
- EBIT increased by 48.48% to Rs 129.53 crores in the year ended March 31, 2022 as against Rs 87.24 crores in year ended March 31, 2021.
Construction Equipment Division:
- Construction Equipment division contribute 10.81% to total turnover of the company.
- Construction Equipment division revenues increased by 31.79% to Rs 176.24 crores in the year ended March 31, 2022 as against Rs 133.73 crores in the year ended March 31, 2021.
- EBIT increased by 38.14% to Rs 9.38 crores in the year ended March 31, 2022 as against Rs 6.79 crores in the year ended March 31, 2021.
Material Handling
- Material Handling division contribute 9.32% to total turnover of the company.
- Material Handling revenues increased by 47.85% to Rs 152.06 crores in the year ended March 31, 2022 as against Rs 102.85 crores in the year ended March 31, 2021.
- EBIT increased by 42.97% to Rs 18.20 crores in the year ended March 31, 2022 as against Rs 12.73 crores in the year ended March 31, 2021.
Agri Equipment
- Agri Equipment contribute 12.15% to total turnover of the company.
- Agri Equipment revenues decreased by 1.09% to Rs 198.03 crores in the year ended March 31, 2022 as against Rs 200.22 crores in the year ended March 31, 2021.
- EBIT decreased by 47.69% to Rs 12.58 crores in the year ended March 31, 2022 as against Rs 24.05 crores in year ended March 31, 2021.
Outlook:
- In March 2021, the government announced a long-term US$ 82 billion plan to invest in the country’s seaports. 574 projects have been identified, under the Sagarmala project, for implementation through 2035.
- The government announced Rs 18,998 crore (US$ 2.61 billion) for metro projects. (Sources:https://www.ibef.org/industry/infrastructuresector-india.)
- Under the Union Budget 2022-23, the Government of India has allocated Rs 199,107.71 crore (US$ 26.04 billion) to the Ministry of Road Transport and Highways.
- The Government of India has allocated Rs 111 lakh crore (US$ 1.4 trillion) under the National Infrastructure Pipeline for FY 2019-25. The roads sector is likely to account for 18% capital expenditure over FY 2019-25.
- The Smart City Project, with a plan to build 100 smart cities, is a prime opportunity for real estate companies. Government of India’s ‘Housing for All’ initiative is expected to bring US$ 1.3 trillion investment in the housing sector by 2025.
CONSTRUCTION EQUIPMENTS INDUSTRY
- Increasing public & private infrastructure, FDI reforms for the construction sector, highway projects and a growing economy has led to the global surge in the construction equipment market in India.
- India Construction Equipment Market is expected to reach US$ 4940 Mn. by 2026, at a CAGR of 5.2% during the forecast period.
- India Crane Market Size by Volume to Reach 15,665 Units by 2027. The India crane market is expected to grow at a CAGR by volume of over 5.56% during the period 2021−2027. The India crane market size by revenue is expected to reach USD 1.3 billion by 2027.
- The less than 20 tons crane-lifting capacity market in India is expected to reach USD 548.8 million by 2027.
- The Indian forklift Market is expected to grow from 11234 units in 2019 to 30293 units in 2027 at a CAGR of 13.2 % during the forecast period. (Sources:https://www.maximizemarketresearch.com/marketreport/india-forklift-market/29716/)
- The Indian agricultural equipment market reached a value of INR 926 Billion in 2021. Looking forward, IMARC Group expects the market to reach INR 1,689 Billion by 2027, exhibiting a CAGR of 10.6% during 2022-2027. (Sources:https://www.imarcgroup.com/farm-agriculturalequipments-industry-india.)
QIP
In Sept 2021, the company concluded qualified institutional placement and allotted 56 lakh equity shares of FV. Rs. 2 each at a price of Rs. 242 per share aggregating to a total amount of ~135 crores.
ACE Financial Performance for FY2022
- At a consolidated level comparing with FY21, Company Total Income grew by 32% to INR 1,630 Crores.
- EBITDA grew by 24% to INR 167 Crores and Profit after Tax grew by 32% to INR 105 Crores.
Pros:
- Company has delivered good profit growth of 50.6% CAGR over last 5 years and 23% last 3 years
- Debt is under control, Debt to Equity ratio is 0.13 (As on TTM)
Cons:
- Promoter holding has decreased over last 3 years: -4.11%
Action Construction Share Analysis Video
Action Construction Share Price Target 2024-2025
Action Construction Share Price Target 2024
| Year | Action Construction Share Price in 2024 |
| 2024 | ₹420 to ₹460 |
Action Construction Equipment Share Price Target 2025
| Year | Action Construction Share Price in 2025 |
| 2025 | ₹ 552 to ₹580 |
Credit Rating for ACE:
ICRA Limited on April 05, 2022 has upgraded the long term rating to AA (pronounced ICRA Double A) from AA- (pronounced ICRA Double A Minus) and re-affirmed the short term rating at A1+ (pronounced ICRA A One Plus). The outlook on the long-term Rating has been revised to Stable from Positive. Further, rating action details are given herein below:
Action Construction SUBSIDIARY/ASSOCIATE COMPANIES:
(As on March 31, 2022)
| Name of the Company/Firm | Status | Country | Holding | Date of Acquisition |
| SC Forma SA | Subsidiary Company | Romania | 89.52% | February 01, 2007 |
| Crane Kraft India Private Limited | Subsidiary Company | India | 99.9999% | December 17, 2021 |
| Namo Metals | Partnership Firm | India | 90.00% | April 01, 2010 |
Action Construction Equipment Shareholding Patterns:
| Holdings | Year 2022(Sept)% |
| Promoters | 66.76 |
| FIIS | 4.86 |
| DIIS | 4.56 |
| Public | 23.83 |
ACE Share Price Target 2030:
| Year | Action Construction Share Price in 2030 |
| 2030 | ₹ 1305 to ₹1450 |
Action Construction Equipment FAQ
Is Action Construction a debt free company?
Company have very low debt, company debt to equity ratio is 0.13 (TTM).
What does Action Construction do?
Action Construction is in the business of manufacturing and marketing of hydraulic mobile cranes, mobile tower cranes, material handling equipment like forklifts, road construction equipment like backhoe loaders, compactors, motor graders and agriculture equipment like tractors, harvesters, rotavators, etc.
Is Action Construction share is a good buy?
Yes, recently we have seen a strong buying from its support level.
Conclusion:
The Company being rewarded with a strong brand reputation and repeat business, resulting in a consistent growth track record. The Company’s versatility to satisfy a diverse range of sectors for wide applications is their biggest strength. According to Company MD, they have a strong conviction that the Company is about to enter a multi-year growth cycle given the anticipated economic expansion of India in the upcoming years. As the ACE is the market leader in Pick & Carry cranes manufacturing, therefore we can expect a robust future growth.
Here is the end of the post Action Construction share price target 2023,2024, 2025-2030, hope we provided some value to you, please write your suggestion below in comment section.
Source: Action Construction Annual Report and Internet
Disclaimer: On this post all the mentioned entries are based on the date, The post was written, these could be change in future.
Nirmal is a NISM Certified Derivative Trader & the Founder of InvestandEarn.net (Financial Blog). He entered the world of Equity research to explore his interests in financial markets having 5+ Years of Experience in Share Market Trading & Investing. Nirmal frequently writes about Share Market Trading & Investment and publishes his personal view on the market. Drop him a mail at nirmal.jaysval@investandearn.net.
