- 10 Nov 2022
- ICICIdirect Research
ACE REPORTS GOOD SET OF NUMBERS IN Q2FY23
ACE - 1340 Change: -22.15 (-1.63 %)News:
Revenue for the quarter came in at Rs 491.8 crore, up 36% YoY, down 1.1% QoQ. Segmental performance was: Crane segment revenue came in at Rs 357.4 crore vs. Rs 349.2 crore in Q1FY23. EBIT margins for the quarter was at 12.8%. Construction equipment segment revenue came in at Rs 54.2 crore vs. Rs 52 crore in Q1FY23. EBIT margins for the quarter were at 6.6%. Material handling segment revenue came in at Rs 35.6 crore vs. Rs 37.9 crore in Q1FY23 with EBIT margins of 10.4%. Agri segment revenue came in at Rs 44.7 crore vs. 58.6 crore in Q1FY23. Gross margins increased ~ 93 bps QoQ. EBIDTA margins came in at 9.2% vs. 8.2% QoQ, Declining EBITDA margins are due to higher GMs. Absolute EBIDTA came in at Rs 45 crore, up 11% QoQ. Employee cost was at Rs 23.8 crore, up 6% QoQ, Other expenses were at Rs 67.4 crore down 4% QoQ. Ensuing PAT came in at Rs 33.9 crore vs. Rs 45.3 crore in Q1FY23 & Rs 23 crore in Q2FY22. Q1FY23 PAT was cushioned by other income of Rs 24.9 crore
View:
ACE posted yet another solid quarter led by EBITDA improvement in cranes and construction equipment. The company has done exceptionally well in H1FY23 led by good volume growth coupled by passing on price hike to its customers and is on track to achieve the revenue guidance by its management. With raw material prices remaining range bound the effect of positive operating leverage has started to seen on EBITDA margin and margin will continue to improve. With strong traction from defence and better expectation from exports, ACE is expected to continue to tread on its growth path. Thus, we maintain our bullish stance on the stock
Impact:
Positive