Action Construction Equipment Limited Action Construction Equipment Limited engages in the manufacture and supply of hydraulic mobile

cranes, mobile tower cranes, and material handling and construction equipment in India. The company offers hydraulic mobile cranes for the engineering, construction, and infrastructure industries for loading, unloading, moving, shifting, and erecting materials; mobile/fixed tower cranes for civil construction; back hoe and wheeled loaders for the construction and infrastructure sector for digging, moving, grading, and loading earth and other loose aggregates. Its products also comprise lorry loader cranes to lift and transport loads; forklift trucks to lift and transport materials; and crawler cranes for use on soft ground for plant erection and maintenance work or plant renovation. In addition, the companys products consist of piling rigs for the construction of bridges, metro rails, and ports; vibratory rollers used to compact loose soil or asphalt for roads and highway construction; and tractors used for farming, construction, and industrial purposes. Its products are also used in various sectors, such as power projects, dams, coal mines, steel industry, railways, cement, petroleum, defense, chemicals and fertilizer plants, and building construction.

Business Description

Notes 1. ACE is the largest Mobile Cranes & Tower Cranes manufacturer in India and has over 50% market share in this segment. 2. The company is the 3rd largest manufacturer of Forklifts in India. 3. It has wide range of products in its portfolio. This enables the company to cross sell to its customers which includes bigwig's of the infrastructure and construction industry. Most of its orders are from repeat customers. 4. The company has a pan-India presence through a network of 96 sales and service locations, supported by 13 area offices and 5 zonal offices at Delhi, Mumbai, Chennai, Kolkata and Visakhapatnam. Positives 5. It has a healthy balance sheet with ZERO long term debt. Cash Flow from Operations is greater than the Net Profit. 6. ACE has sales and marketing tie-up for promotion, distribution and installation of equipment in India with Zoomlion - China for Fixed Tower Cranes, with Autogru PM - Italy for Lorry Loader Cranes, with Maber - Italy for Mast Climbing Platforms and Construction Elevator Lifts, and with TIGIEFFE SRL Italy for Aerial Access Platforms. 7. The company has alloted 3 million equity shares to Reliance Capital Ltd. at Rs. 65.53/- per equity share in October, 2010. 8. Delivered an EPS of Rs 4.30 for FY2011 and paid a dividend of Rs 2.00. Expect EPS of Rs 5.50 in FY2012 and dividend of Rs 2.50. Target Price = 80.00 (P/E = 15) Delivered an EPS of Rs 2.33 by Q2 of FY2012.

Raw Material: The main raw material used by the company is Martensitic (MS) Steel. It constitutes around 60% of its overall cost. Any abrupt or large-scale escalation in the prices of the raw material can adversely affect the profits. Risks and Concerns Competition from Imports: There is threat from similar imported products to the Construction Equipment the company manufactures. However, logistics cost for imports is high and hence does not carry any cost advantage. Downturn in Infrastructure Industry: Any economic slowdown in the infrastructure industry or reduction in government spending will have severe impacts on the revenue and profits as happened during the FY'09 and FY'10.

Competitors

Hydraulic Mobile Cranes: Escorts Construction Equipment Ltd, TIL Mobile Tower Cranes: Protain, Shirke, Bhai Back Hoe Loaders: JCB, L&T, Terex, Tata, Telcon, Caterpillar, BEML Lorry Loader Cranes: TIL , Escorts Construction Equipment Ltd, Imports Tandem Rollers: L&T, Escorts Construction Equipment Ltd Mast Climbing Platforms / Lifts: Imports Tower Cranes: Shirke, Bhai, Imports Aerial Access Platforms: Imports

1. Jajru Road, 25th Mile Stone, Delhi-Mathura Road, Ballabgarh, Faridabad - 121004, Haryana Manufactures: Mobile Cranes, Mobile Tower Cranes (300 units pm) 2. Dhudholla Link Road, Village - Dhudholla, Palwal - 121102, Haryana Manufactures: Tractors, Loaders, Forklift Trucks, Road Making Machinery (450 units pm) Plant Location 3. Plot No.C-5, 6, 7 & 8, UPSIDC Industrial Area-I, Bazpur, Uddham Singh Nagar - 262123, Uttrakhand Manufactures: Mobile Cranes, Mobile Tower Cranes 4. Dhudholla Link Road, Village - Dhudholla, Palwal - 121102, Haryana Manufactures: Tower Cranes 5. Plot No.40 & 41, Nand Nagar Industrial Estate, Phase-1, Mahuakheraganj, Kashipur, Uttrakhand Manufactures: Hydraulic Mobile Cranes: 3X, Rhino 60, Rhino 90 C, Rhino 110 C, 12 XW, 14 XW, 15 XW Mobile / Fixed Tower Cranes: MTC 2418, MTC 3625, TC 5013 B Loader/Backhoe Loader: FEL 75, AX 130 Lorry Loader Cranes Mast Climbing Platforms / Construction Elevators Aerial Access Platforms Reliance Industries Ltd., Airport Authority of India, Punj Lloyd Limited, BHEL, ACC Limited, Bridge & Roof, Shapoorji Pallonji Co. Ltd, Coal India Ltd, Gannon Dunkerley & Co. Ltd., Neyveli Lignite Corporation

Product Offerings

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