Action Construction Equipment shares up 3% on new Defence Ministry order

Shares of Action Construction Equipment (ACE) Limited saw a notable increase of 3% on the morning of September 10, following the announcement of a significant new order from the Defence Ministry. This rise in stock value highlights the impact of securing major contracts and reinforces the importance of monitoring key market developments if you plan to buy shares online.

New Defence order boosts share value

The company disclosed that it has been awarded a contract from the Defence Ministry (MoD) for the delivery of 99 forklifts. This substantial order is part of ACE's strategy to expand its presence in the defence sector. It aligns with the Government of India's 'Make in India' and 'Aatma Nirbhar Bharat' initiatives. The financial specifics of the order were not disclosed, but the announcement alone was sufficient to drive interest in ACE shares.

Impact on stock performance

Following the news, ACE's stock surged by 3.42% to reach an intraday high of ₹1,278 on the NSE. However, the gains moderated slightly, with the stock trading 0.78% higher at ₹1,245.30 by 12:18 pm. For investors considering how to buy shares online, this kind of news can offer valuable insights into stock movement and potential opportunities.

Company's market presence

ACE holds a leading position in the mobile and tower crane segment. Its diverse product range includes mobile and fixed tower cranes, crawler cranes, truck-mounted cranes, forklifts, tractors, harvesters, and other construction equipment. The company's strong market presence spans major infrastructure, construction, and industrial projects nationwide.

Financial performance

For the April-June quarter of FY25, ACE reported a revenue increase of 12.82% to ₹733.63 crore compared to the previous year. The company's EBITDA saw a substantial rise of 28.73%, reaching ₹125.5 crore, and its EBITDA margins improved by 2.11 percentage points to 17.11%. This financial growth, driven by operational efficiency and favourable market conditions, reflects the company's solid performance and enhances its attractiveness to those looking to buy shares online.

Profit and margin expansion

ACE's profit after tax grew by 24.46%, amounting to ₹83.71 crore, up from ₹67.26 crore in the same quarter last year. The margin expansion is attributed to effective cost management, a favourable product mix, and improved price realisations. This steady financial health underscores the potential benefits of investing in ACE and supports the decision for those looking to buy shares online.

Key takeaways

ACE's recent contract with the Defence Ministry is a significant milestone, reinforcing its role in the defence sector and contributing to its stock market performance. For investors seeking opportunities, this development highlights the importance of staying informed and considering such impactful news when deciding to buy shares online. The company's strong financial results and strategic position in the market make it a noteworthy option for investment.