Action Construction Equipments - Q4FY20 First Cut - ICICI Securities

CMP: Rs. 54.25; MCap: Rs. 615 crore

Action Construction Equipments (ACE) reported a sturdy performance in the final quarter clocking in a 2% YoY revenue growth. Construction equipment (forms 10% of revenue) segment grew 51% YoY during the quarter while all other segments remained flattish. Margins expanded on a YoY basis as a result of reduction in input costs.

Q4FY20 Earnings Summary

Revenue for the quarter came in at Rs. 305.5 crore, up 2% YoY. Segmental performance were as follows:

- Cranes - Revenue Rs. 217.4 crore (-2.5% YoY), EBIT Rs. 23.4 crore
- Construction Equipment - Revenue Rs. 34.6 crore (51% YoY), EBIT Rs. 0.5 crore
- Material Handling - Revenue Rs. 21.4 crore (-3.5% YoY), EBIT Rs. 1.6 crore
- Agri Equipment - Revenue Rs. 32.1 crore (1.8%YoY), EBIT Rs. 0.2 crore

Gross margins expanded ~285 bps YoY on account of lower input costs. Consequently, EBIDTA margins came in at 9%, expanding ~100bps YoY. ACE registered an absolute EBIDTA of Rs. 27.4 crore, up 15% YoY

On the expenses side, employee expenses increased 15% YoY coming in at Rs. 23.3 crore while other expenses increased 20% YoY to Rs. 20.2 crore. Thus due to increased expenses, the benefit of higher gross margins to the bottomline were partially negated

PAT came in at Rs. 13.8 crore, up 12.6 % YoY. Tax rate during the quarter came in at 24.6%

The company generated Rs. 47.95 crore in operating cash flows in FY20 ending the year with a cash & bank balance of Rs. 9.25 crore

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.54.25 as compared to the previous close of Rs. 54.35. The total number of shares traded during the day was 103130 in over 1734 trades.

The stock hit an intraday high of Rs. 62.9 and intraday low of 50.85. The net turnover during the day was Rs. 5766143.

Source : Equity Bulls

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