1. 🪖 At a Glance
ACE is India’s largest manufacturer of pick-n-carry cranes, tower cranes, and forklifts – holding over 60% market share in multiple segments. It’s also breaking into defence, road construction, and even tractor markets. With ROCE of 40%, EPS up 5x in 3 years, and a ₹420 Cr Ministry of Defence contract in hand, ACE is no longer just a construction play – it’s a national infrastructure bet. But with a P/E of 34 and stock 25% off highs, is this a crane flying too high or a breakout waiting?
2. 🧱 Intro – From Hard Hat to Hard Cash
- If you’ve seen a bright yellow crane lifting girders near your metro line – chances are it’s an ACE machine.
- The “Maruti of Cranes”, ACE has transformed into a multi-segment player – handling agriculture, construction, and now defence.
- But this isn’t a boring infra company. It’s clocking 51% PAT CAGR over 5 years, expanding margins, and closing in on ₹1,000 Cr quarterly revenue.
So yeah, this crane company ain’t moving slow.
3. 🏗️ WTF Do They Even Do? – Business Model
ACE manufactures and markets:
🚧 Construction Equipment:
- Pick & Carry Cranes (63%+ market share)
- Tower Cranes (60%+ share)
- Forklifts (India’s largest, 19% share)
- Backhoe Loaders, Compactors, Motor Graders
🌾 Agricultural Equipment:
- Tractors, Rotavators, Harvesters
- 10%+ share in Assam tractor market
🛡️ Defence Engineering:
- Now supplying cranes and forklifts to the Ministry of Defence and DRDO
- Multiple MoD orders secured in FY24 & FY25
Revenue split tilts toward cranes (~60%), followed by construction & agri.
4. 💰 Financials – Profit, Margins, ROE, Growth
| Metric | FY21 | FY22 | FY23 | FY24 | FY25E |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 1,227 | 1,630 | 2,160 | 2,914 | 3,327 |
| Net Profit (₹ Cr) | 80 | 105 | 173 | 328 | 409 |
| OPM (%) | 10% | 9% | 10% | 14% | 15% |
| EPS (₹) | 7.03 | 8.82 | 14.41 | 27.56 | 34.36 |
| ROE (%) | 24% | 27% | 28% | 29% | 🤯 |
📈 TTM Profit Growth: 25%
📈 3-Year Profit CAGR: 58%
📈 5-Year Sales CAGR: 24%
5. 📊 Valuation – Cheap, Meh, or Crack?
- CMP: ₹1,194
- TTM EPS: ₹34.36 → P/E = ~34.7x
- Book Value: ₹136 → P/B = ~8.8x
- Dividend Yield: 0.17% (meh)
Valuation is not cheap, but it reflects:
✅ Strong earnings visibility
✅ MoD contracts & infra tailwinds
✅ High ROCE (40%+)
📉 Stock is down ~25% from its ₹1,600 peak. Multiple expansions? Already priced in.
6. 🔥 What’s Cooking – News, Triggers, Drama
🪖 MoD Orders:
- ₹420 Cr order (Feb 2025)
- Forklift & crane supply for defence logistics
- DRDO pilot order in Jan 2023
🤝 JV with KATO (Japan):
- Co-developing high-capacity cranes → export play?
🧱 82 acres land acquisition:
- For capacity expansion and warehousing
🏗️ Infrastructure spending boom → metro, highways, airports → more cranes & loaders
👨✈️ Repeat orders from government agencies = sticky defence revenue
7. 🧾 Balance Sheet – How Much Debt, How Many Dreams?
- Debt: Only ₹16 Cr – almost debt-free
- Reserves: ₹1,591 Cr
- Networth: ~₹1,615 Cr
- Investments: ₹918 Cr (👀 that’s a mini war chest)
- Total Assets: ₹2,711 Cr
📦 Capex is being internally funded. Debt isn’t a concern.
8. 💸 Cash Flow – Sab Number Game Hai
| Year | CFO (₹ Cr) | FCF Est. |
|---|---|---|
| FY22 | 104 | ~90 |
| FY23 | 274 | ~250 |
| FY24 | 433 | ~400 |
| FY25 | 412 | ~370 |
💰 Company is generating serious cash.
🚧 Reinvesting into capacity, land, R&D.
No financial stress. Just expansion hunger.
9. 📈 Ratios – Sexy or Stressy?
| Metric | Value |
|---|---|
| ROE | 28.8% |
| ROCE | 40.3% |
| OPM | 15% |
| Debt/Equity | ~0.01 |
| Inventory Days | 83 |
| Debtor Days | 29 |
| Cash Conversion Cycle | -18 Days (NEGATIVE!) 🤯 |
This company is literally getting paid faster than it pays suppliers. That’s elite.
10. 💵 P&L Breakdown – Show Me the Money
- FY25 Revenue: ₹3,327 Cr
- FY25 EBITDA: ₹506 Cr
- FY25 PAT: ₹409 Cr
- PAT Margin: ~12.3%
- EPS: ₹34.36
Steady margins, accelerating topline, strong PAT.
The crane is lifting profits, not just bricks.
11. ⚖️ Peer Comparison – Who Else is in the Game?
| Company | P/E | ROE | OPM | M-Cap |
|---|---|---|---|---|
| BEML | 65x | 10.5% | 12.5% | ₹19,000 Cr |
| AJAX Engineering | 30x | 25% | 15.3% | ₹7,800 Cr |
| ACE | 34x | 28.8% | 15% | ₹14,200 Cr |
🔍 ACE beats peers on ROE, ROCE, asset-light metrics.
📉 Valuation is rich, but justified given execution.
12. 🧩 Misc – Shareholding, Promoter Moves
- Promoters: 65.41% (steady, no pledges)
- FIIs: 11.57% (up from 4.6% in 2022!)
- DIIs: 1.97%
- Public: 20.97%
📈 FII holding has more than doubled in 2 years. Big money sees long-term infra story.
13. 🧑⚖️ EduInvesting Verdict™
“ACE isn’t just lifting steel beams anymore. It’s lifting profits, defence contracts, and investor expectations.”
✅ Market leader in cranes and forklifts
✅ Margins, cash flows, and order book zooming
✅ MoD deal = credibility + sticky revenue
⚠️ High valuation leaves little room for error
⚠️ Stock is volatile – 25% drawdowns not uncommon
🎯 Fair Value Range
Assuming FY26E EPS of ₹42–₹45
With a justified P/E of 28–32x
🧮 Fair Value Range: ₹1,175 – ₹1,440
(Which means: It’s fairly priced now, with upside tied to MoD execution and exports.)
Tags: ACE, Action Construction Equipment, Defence Stocks India, Crane Manufacturer India, Infra Stocks, High ROCE Stocks, EduInvesting
✍️ Written by Prashant | 📅 July 8, 2025
