Tuesday, 28 February 2017

HIDDEN GEM (INFRA SECTOR GOOD DAYS AHEAD) :::::::::: ACTION CONSTRUCTION EQUIPMENT (ACE) TECHNO-FUNDA PICK


Scripscan:Action Construction Equipment Ltd
CMP:55
Traded in:Nse-bse

Story:ACE manufactures mobile cranes, mobile tower cranes, loaders and backhoe loaders,Tractors.
Action Construction Equipment: The company is engaged in the manufacturing of mobile crane in India. It has entered into series of marketing tie-ups with leading foreign companies like Autogru PM-Italy, Zoomlion-China, Maber-Italy, Tigieffe SRL-Italy, which facilitate the availability of latest technology and machines from around the world.

 The material handling and construction equipment industry is witnessing substantial action with a thrust on the infrastructure sector. As per the Construction Industry Development Council, construction equipment accounts for up to 22-24% of the total project cost in sectors such as roads, power, dams etc.ACE derives 50-60% of its revenues from repeat orders and maintains an order book. Since this is not a long gestation business, orders are placed only 3-4 months prior to the expected requirement and hence, the order book does not accumulate like in other equipment sectors like power plants.While the company has a decent market share of 60% in the domestic market.The outlook for the company and the sector is quite strong. However, rising raw material prices remain a cause for concern.The company is expected to maintain its current growth rate and can improve its margins further, as revenues from tax-free zones add to its bottom line.

FUNDAMENTAL ANALYSIS 
Infrastructure activities are picking up quite rapidly. As Modi Goverment Main focus is on Infrastructure development. We are optimistic that the company would be able to maintain its numero uno position within the domestic pick-and-carry cranes segment. Further, the company's wide range of product offerings, wide pan-India distribution network, and recent cost cutting initiatives, put it in a strong position in comparison to its peers. Given the backdrop of strong earnings growth and RoE expansion potential, Financial Performance improving QOQ 2016-17E earnings per share of Rs 2.40 and arrive at a Price target of Rs 75-90 for the stock. (45-65% UPSIDE)
 
TECHNICAL ANALYSIS 

 Investors can Buy the stock, given good prospects of the infrastructure sector.

STUDY OF YOUR OWN ......... IF U BULLISH ON INFRA SECTOR AND HAVING FAITH MODI JI WILL DO FOR INFRA GROWTH YOU CAN'T IGNORE THIS LEADER.




3 comments:

  1. Super sir ur find a mind blowing company we are proud to be with you.

    ReplyDelete
  2. please keep copy of all past recommended scrips on line in the blog/website.

    ReplyDelete
  3. Superb your stock pick alwys rock

    ReplyDelete