Action Construction Equipment Limited — Q3 FY26 earnings call

Call held 4 Feb 2026

Management summary

Action Construction Equipment reported a flattish Q3 FY26 total income of INR 888 crores, but saw EBITDA and PAT growth of 2.48% and 8.15% respectively, driven by improved margins in its core construction equipment segment. The company is debt-free with significant cash reserves, planning internal funding for future growth and capacity expansion, including new facilities for tower cranes and strategic land acquisitions. Despite some market softness, demand is normalizing, and ACE is optimistic about capitalizing on infrastructure spending and new product technologies, including patented AI-integrated fail-safe cranes.

Highlights

  • Total income for Q3 FY26 was approximately INR 888 crores, remaining flattish on a year-on-year basis.

  • EBITDA for Q3 FY26 grew by 2.48% YoY to INR 164 crores, with an EBITDA margin of 18.5%.

  • PAT for Q3 FY26 increased by 8.15% YoY to INR 115.88 crores, achieving a PAT margin of 13.04%.

  • The Crane Metal Handling and Construction Equipment segment contributed 90% of total revenue, with sales of INR 763 crores and a margin of 20%.

  • The company targets INR 6,000-7,000 crores in revenue by FY29 or FY30, supported by capacity expansion and market share gains.

  • Management expects the top line to be flattish for FY26 but anticipates good growth in both segments next year, with steady-state EBITDA margins of 18-19% in FY27/FY28.

  • The company is debt-free and holds approximately INR 1,200 crores on its books available for deployment.

Key financials

2 periods

Headline

  • Total Income
    ₹888 Cr
    YoY 0%
  • EBITDA
    ₹164 Cr
    YoY +2.5% QoQ +16.3%
  • EBITDA Margin
    18.5%
  • PBT
    ₹151 Cr
    YoY +4.3% QoQ +9.9%
  • PAT
    ₹115.88 Cr
    YoY +8.2% QoQ +11.5%

9M FY26

  • Total Income
    ₹2,373 Cr
    YoY -3.2%
  • EBITDA
    ₹458 Cr
    YoY +7.1%
  • EBITDA Margin
    19.3%
  • PAT
    ₹316 Cr
    YoY +11%

What they filed

Q1 FY27: revenue up 20.6%, net profit up 21.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue757 875 961 652 744 −2%855 −2%1,029 +7%786 +21%
EBITDA109 135 164 93 109 +0%130 −4%172 +5%118 +27%
Net profit95 112 119 98 90 −5%116 +4%111 −7%119 +21%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

Share of Revenue
₹852.44 Cr Total
  • Crane Metal Handling and Construction Equipment ₹763 Cr 89.5%
  • Agri segment ₹89.44 Cr 10.5%

Order book

high confidence

Total value

₹500 Cr

as of 2025-12-31 quantified

Execution

execution starting now, INR 30-40 crores this year, INR 150-200 crores next year

Composition

  • Heavy Recovery Vehicles (Defense) (product) ₹500 Cr 100%
Defense orders of approximately INR 500 crores are in hand, with execution starting now after procedural delays.

Source: Q&A

Capital allocation

high confidence
  • Capex Capex disclosed internally funded
    • Land acquisition for future expansion (Indore, Faridabad, Palwal) ₹250 Cr
    • Developing tower crane plant in Palwal (22 acres)
    We are a debt-free company. ... We have got ample land available. In the current year, we bought land. In the last year, we bought land. ... This INR250 crores worth of land is already INR500 crores. ... First, we will be developing the 22 acres in Palwal.
  • Debt Gross ₹0 Cr · Net ₹0 Cr · 0.0× EBITDA
    We are a debt-free company.
  • Liquidity Cash ₹1,200 Cr INR 1,200 crores available on books to be deployed, supporting a zero working capital scenario.
    Plus, we don't have any debt, plus we have, I think, close to Luthra, you can correct me if I'm wrong, about INR1,200 crores on our books available to be deployed anyway. ... We are a debt-free company. Last year, we were able to bring ourselves to a 0 working capital scenario in our final balance sheet, although in the middle of the year. We are very hopeful by the end of this year, again, we'll be able to bring ourselves to a 0 working capital.

Guidance & targets

Revenue

  • Total Income Growth Revenue · current year (FY26) · High confidence flattish
    Also, we expect our top line to remain flattish during the current year with improved margin profile as compared to the last year.

    — Sorab Agarwal

  • Total Revenue Revenue · by FY29 or FY30 · High confidence INR 6,000-7,000 crores
    What we feel and what we have thought and planned that by FY '29 or latest by FY '30, we should be somewhere between INR6,000 crores to INR7,000 crores.

    — Sorab Agarwal

  • Defense & Export Contribution Revenue · next year (FY27) · High confidence upwards of 10%
    Our plan was 10% to 15%. The first benchmark, hopefully, we should be reaching in FY '27.

    — Sorab Agarwal

  • Defense Contribution Revenue · next year (FY27) · High confidence 4-5%
    We expect that next year, we can go up to 4%, 5% contribution from defense, at least about 4%.

    — Sorab Agarwal

  • Export Contribution Revenue · next year (FY27) · High confidence 10%
    Currently, 9%, so next year, we can be pretty confident it will be somewhere upwards of 10%.

    — Sorab Agarwal

Profitability

  • Margin Profile Profitability · current year (FY26) · High confidence improved
    Also, we expect our top line to remain flattish during the current year with improved margin profile as compared to the last year.

    — Sorab Agarwal

Margin

  • Agri Segment EBIT Margin Margin · over the years to come · Medium confidence 12-15%
    Yes, from there from 4%, 5%, our endeavor and target is that, that needs to go to at least 12% to 15% level so that it comes to some sort of a sensible margin profile over the years to come, and then we are definitely working towards it.

    — Sorab Agarwal

  • Steady-state EBITDA Margin (with other income) Margin · FY27/FY28 · High confidence 18-19%
    I think what we have been achieving in the recent quarters should be our benchmark for, let's say, the next year after that, maybe close to about, let's say, 18%, 19% if we include other income and close to about 15% plus/minus without other income.

    — Sorab Agarwal

Capacity

  • Tower Cranes Capacity Capacity · next year · Medium confidence 1,100 units
    Because our current capacity is 800-900, we are doing a small rejig so that our capacity comes closer to maybe 1,100 units, which can suffice for next year requirement.

    — Sorab Agarwal

Volume

  • Backhoe Loaders Volume Volume · next year · Medium confidence 1,200-1,300 units
    We feel that even in the coming year from this 800, 900 units, we should easily go to 1,300, 1,200 units, that's a 30%, 40% increase.

    — Sorab Agarwal

  • Backhoe Loaders Volume Growth Volume · next 5 years · Medium confidence 3x
    Over the next 5 years, maybe a 3x is what it seems things are.

    — Sorab Agarwal

Product Launch

  • Electric Cranes Commercial Sale Product Launch · this quarter (Q3 FY26) · High confidence ready
    Within this quarter, the electric cranes will become ready for commercial sale

    — Sorab Agarwal

Market Growth

  • Overall Market Growth Market Growth · 1-2 years · Medium confidence 25-30%
    I just hope that the 25%, 30% growth scenario comes back as soon as possible because it will be 1 or 2 years, and we are also feeling wasted.

    — Sorab Agarwal

What to watch in Q4 FY26

Anti-dumping duty notification for Chinese cranes

next quarter
Current Recommended by DGTR, awaiting Finance Ministry notification
Target Notification of anti-dumping duty

Why it matters

Resolution of this could significantly improve competitiveness and market share in the larger crane segment.

Finally, duty was recommended on the Chinese cranes in the month of September. Unfortunately, for some good-bad reason, it has not been notified by the Finance Ministry.

Risks & concerns

  • Chinese competition in bigger cranes

    medium

    Chinese players are aggressive with predatory pricing and credit terms in the truck and crawler crane segments.

    Management acknowledged

  • Delay in anti-dumping duty notification

    medium

    Anti-dumping duty recommended by DGTR in September for Chinese cranes has not yet been notified by the Finance Ministry.

    Management acknowledged

  • Agri segment margin pressure

    medium

    Agri segment profitability struggled in Q3 FY26, with EBIT margin dropping to ~1% due to provisioning, but management targets 12-15%.

    Management acknowledged

  • Market slowdown factors

    low

    Market was slow in the last 1-1.5 years due to election results, prebuying, extended monsoon, and geopolitical factors, but sentiment is now improving.

    Management downplayed

  • Procedural delays in defense order execution

    low

    Execution of approximately INR 500 crores of defense orders was delayed due to procedural issues but is now commencing.

    Management acknowledged

Q&A highlights

8 direct
Chinese Competition and Anti-dumping Duty Direct
Finally, duty was recommended on the Chinese cranes in the month of September. Unfortunately, for some good-bad reason, it has not been notified by the Finance Ministry.

Highlights a key competitive challenge and regulatory delay impacting the larger crane segment, which ACE is trying to penetrate.

Asked by Garvit Goyal

Long-term Revenue Target and Funding Direct
I think reaching INR6,000 crores to INR7,000 crores kind of scenario over the next 3 to 4 years should not be difficult unless something major was to happen in the world economy or Indian economy. ... We are a debt-free company. ... Plus, we don't have any debt, plus we have, I think, close to ... INR1,200 crores on our books available to be deployed anyway.

Provides clear long-term revenue targets and confirms the company's strong financial position to fund growth internally without external debt or equity.

Asked by Pankaj Tibrewal

PLI Scheme for Construction Equipment Direct
This is a PLI scheme, wherein for the first time, focus is being given to construction and infrastructure equipment in India and especially to those equipment where our country relies mainly on imports of equipment or where the percentage of the demand fulfillment in India is more from imports... Hopefully, it should be out in the next 2, 3, 4 months, maybe it can be a favor in the absence of the antidumping duty order, which we were expecting.

Details a significant government initiative that could boost domestic manufacturing and reduce import reliance, potentially benefiting ACE's product portfolio.

Asked by Kaushik Poddar

Agri Segment Margins and Harvester Market Direct
Agri, we are struggling as a matter of fact, especially in the last quarter. ... Our profitability has gone down to about a percentage there in this last quarter... from 4%, 5%, our endeavor and target is that, that needs to go to at least 12% to 15% level.

Reveals a significant margin challenge in the Agri segment this quarter and sets a clear target for recovery, indicating management's focus on improving this segment's profitability.

Asked by Rochan Charan

Backhoe Loader Market and JCB Competition Direct
Our pricing is much better than JCB. Machine is very similar, but the issue is that over the years, what has happened that today, JCB as a company is really not selling their backhoe loaders, but all the NBFCs are selling their backhoe loaders. ... We're working on it. Very soon, I think we should be able to break that cycle also.

Explains the unique competitive dynamic in the backhoe loader market where NBFCs' preference for JCB, rather than product or price, is the primary barrier for ACE, and outlines management's strategy to address it.

Asked by Kunal Tokas

AI Integration and Patented Features in Cranes Direct
Replication of the same should not be possible because the new 4-odd features which we have introduced in our machines, we have patented them before we introduced it on the machine. ... What these do is they basically make the crane fail safe.

Highlights ACE's focus on innovation and proprietary technology, suggesting a sustainable competitive advantage and premium pricing potential for its new crane models.

Asked by Param

Defense Order Pipeline and Execution Direct
There is an order of close to about 150 machines. They are called heavy recovery vehicles, which we are expecting any time. ... We are very hopeful that in the next year, we will execute about INR150 crores, INR200 crores worth of orders. That should increase make it about a 5%, 4% contribution from defense.

Provides specific details on the defense order book, execution timeline, and its expected contribution to revenue, indicating a new growth avenue.

Asked by Rajeev Maheshwari

Land Acquisition Strategy Direct
The rationale was to rationalize on the outward logistic cost because Madhya Pradesh, Indore is, we believe, more or less like more closer to Central India. ... This INR250 crores worth of land is already INR500 crores.

Explains the strategic rationale behind recent land acquisitions for future capacity expansion and logistical advantages, demonstrating proactive long-term planning.

Asked by Rajeev Maheshwari

3 min read 6 chapters

Detailed narrative

Q3 FY26 Financial Performance and 9M Overview

Action Construction Equipment reported a flattish total income of approximately INR 888 crores for Q3 FY26 on a year-on-year basis. Despite this, EBITDA grew by 2.48% to INR 164 crores, with the EBITDA margin expanding to 18.5%. PAT increased by 8.15% to INR 115.88 crores, achieving a PAT margin of 13.04%. For the nine months ended December 2025, total income declined by 3.21% YoY to INR 2,373 crores, but EBITDA grew by 7.15% to INR 458 crores, with a margin of 19.32%, and PAT grew by 11% to INR 316 crores.

Segmental Performance and Product Mix

The Crane Metal Handling and Construction Equipment segment remained the primary revenue driver, contributing 90% of total revenue with INR 763 crores in Q3 FY26, a 10% sequential growth. This segment sold 2,710 units and achieved a margin of 20%. In contrast, the Agri segment contributed 10% of revenue with INR 89.44 crores, but experienced a significant drop in EBIT margin to approximately 1% in Q3 FY26 due to provisioning. Management noted that new generation cranes, particularly bigger pick and carry cranes and tower cranes, are becoming more popular, driving margin improvement through a favorable product mix.

Strategic Growth Initiatives and Capacity Expansion

ACE aims to achieve INR 6,000-7,000 crores in revenue by FY29 or FY30. The company's current capacity can be expanded from INR 5,000 crores to INR 5,500-6,000 crores with minor tweaks. Plans are underway to expand tower crane capacity to 1,100 units next year, including setting up a new plant in Palwal. Additionally, ACE has acquired land in Palwal (22 acres for the new plant, 86 acres for future expansion) and Indore (30 acres for future expansion) to rationalize logistics and diversify input supply, investing INR 250 crores in land that is now valued at INR 500 crores.

Innovation and Competitive Landscape

ACE is focusing on new age technology, having unveiled intelligent tower cranes, AI-assisted pick and carry cranes, and advanced aerial work platforms. The company has patented four new features in its cranes, making them 'fail-safe' and enhancing operator safety and comfort, for which the market is willing to pay a premium. While Chinese players are aggressive in the larger crane segments due to predatory pricing, ACE faces no significant competition in pick and carry cranes. The company is also working to address the NBFC-driven preference for JCB in the backhoe loader market.

Government Support and Export/Defense Focus

The Union Budget 2026 reinforces a growth-oriented roadmap with continued thrust on capital expenditure, including initiatives like the infrastructure risk guarantee fund and dedicated freight corridors. ACE expects to benefit from the upcoming PLI scheme for construction and infrastructure equipment, which targets import substitution. The company aims for defense and exports to contribute upwards of 10% to revenue by FY27, with defense contribution rising to 4-5% (from ~2%) and export contribution reaching 10% (from 6-7%). Currently, ACE has approximately INR 500 crores in defense orders, with INR 150-200 crores expected to be executed next year.

Capital Allocation and Liquidity

ACE maintains a debt-free status and aims for a zero working capital scenario by the end of the current fiscal year, a feat achieved last year. The company has approximately INR 1,200 crores available on its books, which it plans to deploy for internal growth and strategic initiatives, including capacity expansion and land acquisitions, without the need for external debt or equity raises. This strong liquidity position supports its ambitious growth targets and allows for strategic investments.

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