Action Construction Equipment - Q2FY21 First Cut - ICICI Direct

(CMP: Rs. 72; MCap: Rs. 822 crore)

Action's Q2FY21 performance was upright better than our expectations and management guidance. Underperformance of the crane segment was offset by upbeat numbers in Material handling & Agri equipment segment.

Q2FY21 Earnings Summary

- Revenue for the quarter came in at Rs. 268.3 crore, which was flat on a YoY basis. Segmental performance was as follows

Cranes Revenue: Rs. 166.4 crore (down, ~16.5% YoY), EBIT Rs. 15.2 crore

Construction Equipment: Revenue Rs. 30.8 crore (up, ~55 YoY), EBIT Rs. 39.9 lakhs

Material Handling: Revenue Rs. 26.5 crore (up, ~32% YoY), EBIT Rs. 3.5 crore

Agri Equipment: Revenue Rs. 44.7 crore (up, ~55%YoY), EBIT Rs. 5.8 crore

- Gross margins contracted ~180 bps YoY on account of higher input costs. However, cost rationalization efforts led to a decline of 15% & 27% in employee & other expenses respectively. Consequently, EBIDTA increased 19.8% YoY to Rs. 24.2 crore with an expansion of ~ 150 bps in the entailing margin

- Subsequently, ACE reported a net profit of Rs. 14.59 crore vs a loss of 4.2 crore in Q1FY21

We would come out with a detailed report post the Conference call.

Shares of ACTION CONSTRUCTION EQUIPMENT LTD. was last trading in BSE at Rs.72.3 as compared to the previous close of Rs. 71.2. The total number of shares traded during the day was 27800 in over 525 trades.

The stock hit an intraday high of Rs. 74 and intraday low of 69. The net turnover during the day was Rs. 2025370.

Source : Equity Bulls

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