Action Construction Equipment Limited (NSE: ACE) Q1 2026 Earnings Call dated Aug. 11, 2025
Corporate Participants:
Unidentified Speaker
Rajan Luthra — Chief Financial Officer
Sorab Agarwal — Executive Director
Vyom Agarwal — Head of Investor Relations
Analysts:
Unidentified Participant
Aman — Analyst
Aditya — Analyst
Rajeev Maheshwari — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Action Construction Equipment Ltd. Q1FY26 earnings conference call hosted by Evandes Park. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Ravi Swaminathan from Evendes Park. Thank you. And over to you.
Unidentified Participant
Good afternoon everyone. On behalf of Evandes park, we are pleased to invite you to the Q1FY26 earnings conference call of action Construction Equipment Limited. I would like to welcome the management and thank them for the opportunity we have with us today. Mr. Saurabh Bhagrawal, Executive Director, Mr. Rajan Luthra, the CFO and Mr. Vyom Agrawal, the President from Action Construction Equipment Management. I shall now hand over the conference to Mr. Sourab Agarwal, Executive Director of Action Construction Equipment. Thank you. And over to you, sir.
Sorab Agarwal — Executive Director
Yeah. Thank you, Ravi. Yeah. Good evening and welcome everyone to this earnings conference call for discussing the results for quarter ended June 25th. Along with me in today’s earnings con call, we have our CFO Mr. Rajan Luthra and our President, Mr. Vayom Agarwal. The company’s financial statements and the earnings presentation summarizing the performance of Quarter 1 FY26 has been circulated and uploaded on the stock exchanges. And I will take you through some of the key highlights of our performance in the quarter gone by. As anticipated in our previous quarterly commentary, the current financial year begin on a subdued note.
This was primarily driven by the implementation of CEV 5 stage 5 emission norms and enhanced safety certification requirements which have aligned our industry with global benchmarks. These regulatory changes has led to a consequential price increase of 7 to 12% across majority categories of products. Additionally, the Indo Paath border tensions and prevailing global uncertainties have further weakened customer sentiment towards capital investments. The situation was compounded by pre buying of equipment in quarter three and quarter four of the previous fiscal year along with the early onset of monsoon. All of which contributed to a muted demand in the quarter under review.
Amidst the challenging operating environment. As stated above, the company delivered resilient performance during the quarter and we were able to achieve targeted margin profile. We continue to focus on improving product security while fortifying our balance sheet and distribution strength to reinforce our competitive position. In the last few years we have delivered high growth across our business segments and our operating metrics are best in the industry now. Now to brief you on financial performance of Quarter 1 FY26 on standalone basis, our total income stood at 703 crores which is lower by 7.63% as compared to the same quarter last year.
Despite the challenges, our margin profile expanded by almost 300 basis points and the EBITDA for the quarter increased by more than 13.6% to 142.55 crores as against 125.5 crores. The EBITDA for the quarter stood at 20.28%. The PVT grew by 13.66% to 126.64 crores and the PAT grew by 15.67% to 96.83 crores as compared to 83.71 crore for last year’s corresponding quarter. The PBT and PAT margins now stand at 18.02% and 13.77% expanding by 338 basis points and 277 basis points respectively for the quarter on a stand alone basis. Margin expansion for the company was driven by our cost efficiencies, soft commodity prices and price increase that we had affected in the last quarter on account of general inflation and implementation of revised emission and safety norms coupled with increase in other income of the company.
It is important to Note that the first half of the year typically contributes around 40 to 45% to our annual revenues with the second half generally being stronger as market conditions stabilize. In H2 of last year, we saw a surge in demand driven by anticipated purchases ahead of the transition to new emission norms resulting in liquidation of older inventory within quarter one of FY26. Looking ahead, we expect market activity to normalize from quarter two onwards, moving on to segmental performance in the cranes, construction equipment and metal handling segment. During the quarter gone by, we registered consolidated revenue of 605 crores as compared to 690 crores in Quarter 1 FY25.
However, the margins expanded to 107.83 crores as compared to 103.76 crores which leads to an expansion by 279 basis points for the division. The agri revenue increased by 8.26% on a year on year basis to rupees 46.51 crores as compared to 42.96 crores going forward. With retreating monsoons, early festive season, better liquidity and consumer credit availability, we expect the demand momentum to improve across our product range. Looking ahead, the macroeconomic fundamentals of the Indian economy remain resilient despite global headwinds marked by geopolitical tensions, evolving trade policy dynamics and heightened uncertainty and volatility in the operating environment.
Lower inflation, reduction in interest rates and liquidity support by RBI coupled with tax cuts announced in the recent union budget are expected to support growth in the coming quarters range and construction equipment and metal handling business has done well in the recent times and is poised well for further growth. With government trust on attaining sustainable growth in manufacturing and focus on infrastructure projects, there has been short term turbulence, but the demand for construction machinery is expected to normalize post monsoons and we expect the medium to long term growth momentum to continue. However, we will communicate our guidance post the monsoons depending on the overall macroeconomic scenario, settlement of geopolitical issues and the festive season sales trend further.
With our capacity built up and process optimization in place, we remain optimistic about the medium to long term prospects of the company and remain committed to deliver our sustained agenda of growth. With this, I would request the moderator to open the call for question and answer session. Please. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touch tone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking the question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Puneet Zaveri from Zaveri and company. Please go ahead.
Unidentified Participant
Hello sir and thanks so much for the opportunity. Just wanted to understand in this quarter you mentioned that there were some new emission norms and that’s the reason why a lot of pre buying happened in quarter three and quarter four. So currently has that continued in quarter two? Or do you see that demand has come in between July and August? I know you can’t give any numbers but the conversation with the customer has that already happened that you are seeing that the demand is back to a certain level compared to the second half of last year?
Sorab Agarwal
Yes, you know quarter one was a dampener because of the price increase and obviously the technology change especially from BS3 to BS5. So a lot of customers, especially for machines having engines smaller than 50 horsepower are very skeptical of the Electronic engine going straight from mechanical to electronic. And that seems to have settled, even the price increase seems to have settled in now with a reasonable number of deliveries for you know, BS3 to BS5 compliant machine which has happened. So things seem to be stabilizing there. And yes, the inquiry level I would say especially in the last 10, 15 days, 20 days started to normalize a little.
Yes. The only thing is this is more or less peak rain time happening and the rain start to recede post August 15th. So that’s when things really start to improve and by middle of September they are more or less normal. That has been the normal trend over all the years in the past. So yes things are looking a little better.
Unidentified Participant
And so is the expectation that quarter two will largely be flat compared to the same time last year?
Sorab Agarwal
I think so. You know it has always been like that generally and looking at the current scenario coupled with global uncertainties and you know, a general sentiment. So it should be flattish maybe slightly more. But the best time to comment would be with respect to quarter two would be I think, you know, another one month down the line.
Unidentified Participant
Also sir, could you give us the.
Sorab Agarwal
Action would have started to happen. Right, right.
Unidentified Participant
And sir, could you give us some picture on your exports? Currently I think in this quarter you sold roughly 2337 cranes, construction equipments and material handling equipment. So out of that, if not a. Direct number, could you give us what. Was the export revenue in this quarter and how is it shaping up?
Sorab Agarwal
Yeah, I think the export revenue in the current quarter was close to around 27 crores and it is shaping up well. So in terms of, you know what our expectation for the whole year for export last year we had gone down to 4% of to our total revenue contribution and this year it appears that it can easily go up to 6 to 7%. And so that is for exports and like we’ve always said coupled with defense. So 3 to 4% for defense in this year, 6 to 7% for exports. So let’s say about a 10% contribution can come from both of these put together.
And like conveyed in the past our mid income Target was about 10 to 15% from these two segments put together. So hopefully we should be hitting a 10% mark this year.
Unidentified Participant
Got it sir. And in terms of margins as well as your exports currently at similar margins to domestic because the domestic, your overall margins have actually now hit a life I think at over 20%. So how should we look at margins for the export? Is it similar generally? Because it’s a little higher than Domestic. But for you specifically, if you can give us some color.
Sorab Agarwal
Yes, definitely the export margins are slightly better than the domestic margins and this 20% there has been a reasonable contribution in this quarter from the other income. So I think, I believe that they should stabilize our overall margins somewhere around 16 to 17%.
Unidentified Participant
And the final question in terms of, you know, both Defense as well as one of your, you had a Ghana project as well. So if you can give us some update on that for Defense. I think you mentioned in your presentation as well that you’ve gotten a single order. How much of that is already executed up until now? If you can give us some update and when will you. When you expect this to fully finish? Would it be in the next two years? And you also had a Ghana project I think sometime last year but I think it had gotten stuck because of the government there.
Is that still on or is that now? That seems distant to start at least, at least in the near term.
Sorab Agarwal
First I’ll answer. With respect to Ghana project, I think it is in a limbo as of now. It has been like that for the last one and a half two years and till such time there is financial clarity. We really don’t know how to proceed about it. Although our agreement with the Exim bank of India and the three party agreement, everything is in place but you know the funding has been stopped so obviously as of now we see no light there with respect to Defense. Yes, we did receive our single largest order, I think it was in the last quarter and execution stated to start quarter three.
But in a small way there are a lot of requirements with respect to training and a lot of documentation that needs to be done for this which is happening. The order is in place, everything is fine. So hopefully in quarter three we start executing. It will pick up steam in quarter four. So we get some contribution within this year from maybe about 50, 60, 70 crores of business we’ll be doing out of this order in this year and most of it will go into the next year. So maybe close to about 53. So let’s say about 200 crore execution in the next year and whatever the balance will go into the year after that.
About I would say 50, 60 crores in this year, 200 crores in the next year and the balance 100 plus whatever will go into the year after that.
Unidentified Participant
And so have you participated in any more tenders or are you expecting any more tenders to come from at least from the defense space in the orders that you want to go for in this year is that something that you’re already doing in quarter one and the start of quarter two.
Sorab Agarwal
Yes, you know, but this, right now the business I’m going to talk about is basically with Ashok Leyland Defense because you know, the lot of projects which are happening integrated on a Tata or a Leyland World vehicle. So this, the order we are about to get is again a good order, not very big, but let’s say close to about 45, 50 crores it’s already done. And another one similar one, another 90 odd machines after this which would be again close to 70, 80 crores is on the Anvil. So yes, things are progressing there in, in the interim we are I think nearly finalized some more 602 model cranes which we had supplied to army which that is in the pipeline.
Very recently we have executed orders for BRO again for backhoe loaders and for motor graders. Again there is a. This time one of the biggest requirements, they have come out within a single tender. So yes, things are happening and I foresee this as some sort of a continuous pipeline of around, you know, maybe 3 to 4% on a yearly basis to continue.
Unidentified Participant
Thanks so much. Thank you for the opportunity and for being so transparent. Thanks.
operator
Thank you. A reminder to the participants, please press star N1 to ask a question. The next question is from the line of Ritesh Chaudhia, an individual investor. Please go ahead.
Unidentified Participant
Good afternoon, sir. Good afternoon, sir. In the last quarter we have taken part in the Guama Munich exhibition. So do you have any takeovers especially respect to the European or the export market post?
Sorab Agarwal
Yeah, we had participated in Burma in April. We got very good response and the main purpose was to showcase our products and you know, especially get dealership distributors and similar partners in different countries or maybe get better ones in the countries we are already operating in. So yes, a long list of possible future dealers, distributors has been drawn up and we are working on it. We have established a couple of new ones and we have also been able to establish a couple of dealerships within Europe as well, especially for our smaller tractor, the orchard tractor, which is, which is very popular there.
So, and I think very soon again in the next two, three months we are going to be participating in, I think it’s called Agri Technica or whatever, which is specially for agriculture in Europe. We tend to participate there as well.
Unidentified Participant
Okay.
operator
Thank you. Participants, to ask questions, please press star and 1. The next question is from the line of Aman, an individual investor. Please go ahead.
Sorab Agarwal
You’ll have to be a bit louder, not audible.
Aman
Hello, I’m audible Now.
Sorab Agarwal
Yeah, yeah, much better.
Aman
Yeah. Sir. So one of your peers known as Escort. So they have lost a market share of around 150, 150 basis points. They gain a market share of around 150 basis point. So like, so what’s, what’s happening here? So have you lost any market share in the current, current segment?
Sorab Agarwal
No, not really. I’ll explain it to you. See the pick and carry cranes consist of two types of crane. One is a Hydra type, the old generation and the new generation. The split between Hydra and new generation is approximately about 55 60% for the Hydra type, about 35, 40% for the new generation type. Within the new generation the market share between the Scots and our company is similar. We are about 50, 51% rather they are close to that 49, 50%. And the other type which is about I would say 55, 60% of the market, the Hydra type there our market share is 70% plus I would say maybe in the range of 70, 75%.
And those are the machines which have majorly gone from BS3 to BS5, you know, which have gone that 12, 13% price increase and not 5, 6%, 6, 7% price increase. And those machines primarily go to the retail segment, to the industrial areas, to the rental companies and transporters and handling people working in the industrial areas and manufacturing sectors. So they, and this is the part of the market which has been, you know, which was in some sort of a suspended abeyance in the last two, three months. And that’s why the numbers have not been so healthy because we had more than 70% market share here and this market shrank the maximum because of CEV5 BS5 effect.
So that is the reason you are temporarily seeing maybe a 1 or 2% share here and there. By the end of this quarter everything will normalize. As a matter of fact we might be slightly a little off of as soon as these Hydra type of frames the market normalizes which has started happening.
Aman
Okay sir, so and the second question I had is on the construction equipment side, what is the outlook for the rest of your year? And is. Yeah, and we are seeing any government capex in the future?
Sorab Agarwal
Yeah, yeah, quite a lot. The construction equipment and road machinery side of our business. We are hopeful that that should be able to grow at least 30, 40% this year. And only three, four days back our minister for Mr. Gadkari, road transport and highway, he’s conveyed that you know the process for releasing orders for roads and all are going to be sped up very quickly so 2 lakh crores worth of orders have been released but 7 lakh crores would be released released very quickly. And in the next year he’s planning for 10 lakh crores. So I think with respect to special construction equipment and road machinery, I think there should be good times ahead.
Aman
Okay, thank you.
operator
Thank you. A reminder to the participants, please press star and one to ask a question. The next question is from the line of Deepak Ajmera from Ige India. Please go ahead.
Unidentified Participant
Thanks for the opportunity. On the volume side, since you said Q3 and Q4 was like early buying because of the transition. So this year we will be looking at like de growth in volume by the year end or how should we look at?
Sorab Agarwal
I don’t think so because the second half is definitely much better for us and all the range and everything. Most of the issues would have been settled including the DS5. So I don’t think we would be looking at volume degrowth or anything. As a matter of fact there should be contribution with respect to price increase which has happened coupled with some volume growth. But yes, the exact quantum of what growth we should be looking at for this year let’s say a reasonably precise number. I think the best time would be end of second quarter to come up with that.
Unidentified Participant
Got it. And would be absorption at the market means what sort of percentage increase is not impacting the volume and what’s the strategy how much we are increasing the Q3?
Sorab Agarwal
Deepak, your question was somehow not very clear to me. If you could just repeat it.
Unidentified Participant
Yeah, I’m saying the what is our strategy on the price increase and how much we will we are planning to increase in Q3, say Q4 and why when we can expect the transition is fully over in terms of price increase.
Sorab Agarwal
Transition from our side with respect to price increase started happening in April and obviously there are no old stocks left anywhere, not even with our dealerships and they could not have been registered post June. So price increase has been pushed. Market has come to terms with the price that has been increased because of increased safety requirements and especially the Tier 5, the CEV5DS5 emission norms. And so the effect is already showing somewhat in the last quarter’s numbers which we have released and they’ll be more pronounced in the current quarter and generally on account of inflation and other expenses increasing, we take a price increase every January.
So apart from what we have done in April, I don’t any price increase till December. And the commodity prices also as of now remain reasonably under control. So I see no need for price increase. Unless until there is a very swift movement in steel or some other major commodity price, I don’t foresee any further price increase in the currency.
Unidentified Participant
Got it. Thank you. Thanks.
operator
Thank you. Participants to ask question please press star and 1. The next question is from the line of Aditya from Old Bridge Mutual fund. Please go ahead.
Aditya
Hello sir. Good evening and thank you for the opportunity. So my first question is. Sorry if I’m repeating the question as I joined a bit late. So my first question is on the gross margins. So this quarter we have seen gross margins expand considerably to 34% kind of a number. So is this all due to the pricing increase that we have taken place?
Sorab Agarwal
Yeah, it’s a mix of lot of things. But yes, especially price increase and reasonably accommodative commodity prices all put together. But yes, you can definitely say the major factor is the price increases.
Aditya
Okay, so how much of this would be sustainable going forward? And where do you see this gross margin margin stabilizing for the year?
Sorab Agarwal
Yeah, I think this is totally sustainable. And as we have communicated earlier, so I think around gross margins of anywhere between 33 to 35% could be to let’s say 34%. What you mentioned is actually the ballpoint plus minus percentage from there are sustainable.
Aditya
Okay, okay, just on that. So with this new engine emission norm change, how much would be the price increase that we have taken a vehicle and how much income commensurate to that? How much would be the cost increase for the particular vehicle that we make?
Sorab Agarwal
The price increase we have taken from machines which were below 50 horsepower. So that is BS3 to BS5 is close to about 12 to 13%. And machines which went from BS4 to BS5 is close to about 6 to 7%. And the price increases are accommodative of this approximate gross margin.
Aditya
Okay, okay. Okay.
Sorab Agarwal
Otherwise if you would have just passed on the price increase, our gross margins would have gone down.
Aditya
Yeah. And one last thing on the on tower cranes. So in this quarter, so if we see the overall cranes construction equipment segment volumes, volumes were down by 21%. What would be the case for tower cranes? If you look at quarter one FY25 last year or over last quarter as well, what would can you, if you can give some volume numbers for the Q1FY25 and Q4FY25 for tower crane year.
Sorab Agarwal
On year quarter one to quarter one tower cranes has increased from 144 to 167. Yeah, real estate side of our business has been holding up. So you know, even when we look at the overall industry, not only our company, but let’s say all other segments of construction equipment wherein we are not present also, for example, earth moving year on year has held up. Material handling, which includes our types of crane primarily has gone down a little. And owing to, you know, that 50 horsepower, the price increasing 12, 13% an engine from being mechanical straight away going to the high end electronics.
So this is the biggest sufferer. If you look at material processing type of equipment, again the volumes have held up. If you look at concrete machinery, concrete pumps, transit mixers, again the volumes have held up. So I think this is a temporary phenomenon with respect to the price increase coupled with the, you know, the pre buying that happened. So like I said, the tower cranes have gone up and most of the other categories within us, even if you look at the forklifts, the numbers have gone up by about 10% on a year, on year. And they were primarily driven by, you know, pick and carry claims on account of pricing and other factors put together feedback.
Aditya
All right, thank you. Thank you so much, sir.
operator
Yeah, thank you. Before we take the next question, we would like to remind participants that you can press star and one to ask a question. The next question is from the line of Rajiv Maheshwari from Praj Investment. Please go ahead.
Rajeev Maheshwari
Good evening everyone. Thanks for giving me the opportunity for asking the queries. The first update which I want is it’s been almost a year when this Kato JV was formally announced in the stock exchanges. But somehow the official statement on the finalization has still not come up. So can you just update me on the same.
Sorab Agarwal
Yeah, it is very much under progress and we are hopeful that within this quarter or early next quarter, sorry, the agreement would be concluded in totality and work can start. So we are targeting to start work quarter three.
Rajeev Maheshwari
Okay. Another part regarding the Q1 result is the other income has come up around I think 50 odd crores. So what exactly is this other income which has come up in the numbers increasing by 250 crores?
Sorab Agarwal
Yeah, this is more to do with the investments the company has made over the years with accumulated cash. And I think Mr. Luther would be the right person to shed more light on it.
Rajan Luthra
Okay, yeah, you are right. It is the income.
Sorab Agarwal
So you are right. This is the income generated on the investments what we have made. We have surplus cash, what we generate from a business, we invest into, do investments and all those kind do not pump into a working capital and just.
Rajeev Maheshwari
Okay, coming to the July 25th sales, can you give Me the numbers, how many equipments and machines we have sold in the month of July this year.
Sorab Agarwal
I don’t think we would be having July data with us right now. Do you have it? The July numbers are you can say more or less similar to June numbers. And overall, if. If we talk about the main all put together, I will have to work it out. But.
Rajeev Maheshwari
So basically this July number. Yeah, please go ahead.
Sorab Agarwal
Maybe Mr. Lutra, you can send the numbers to Mr. Rajiv Maheshwari, right?
Rajan Luthra
Yeah, sure. No, no problem. So. So the number for July 25 or maybe till 10th of August is the same if we compare to year on year July 2024.
Sorab Agarwal
Sure, sure. Because otherwise I don’t have them in front of me.
Rajeev Maheshwari
No, if you can just give me a fair estimate that it’s slightish or it’s a degrowth or it’s a growth that would serve and Mr. Luthora can find me later or not an issue.
Sorab Agarwal
It should be similar with a. With a slightly negative bias, I’m sure.
Rajeev Maheshwari
Okay, okay. So. So maybe with the negative bias. It’s on the similar lines. One thing you told in the beginning of I think three of the orders in which we are almost done or on the verge of getting it. One was you told in tie up with that Ashok Leyland and the other one was some motor grader order and another third one was 70 to 80 crore. So can you throw a light on these orders in a bit details? And when exactly do we expect to get a formal announcement for the same.
Sorab Agarwal
Yes, I think first is with Ashoknath with respect to 54 special machines which are again for the army. They are called hrv which is more or less through the only thing army wants, another 90. And looking at the, you know, the, let’s say the lead time for the components for putting it together, we are not able to confirm the Delivery. Okay, so 54 machines, which is more or less confirmed and the 19 machines order. We are hopeful that over the next week, 10 days we are able to, you know, try and people are working on it, how to, you know, catch up on the delivery part which the army wants.
Because otherwise, you know, damages and other things come into play. And yes, there is a tender for motor graders which has come up. We are very hopeful we will be in a position to get it that another two, three things, four things are also happening.
Rajeev Maheshwari
Okay. Okay. So lots of things are there which are expected to maybe come into the normal domain maybe next month or so. And any organic or inorganic growth which we are looking currently or Any discussions going or we are through all those things as of now.
Sorab Agarwal
No. We are looking at inorganic growth and we are working very actively on some proposals. So hopefully over the next one or two quarters as things progress, we would like to update as and when there is something concrete. But definitely we are looking at some inorganic proposals and we are also looking at some organic and especially some white labeling. Small ones have started. There was a reasonably big proposal on the anvil with respect to white labeling but unfortunately the tariffs have played spoiled sport in the last 10, 15 days. TRUMP Tariffs? Yes. As of now, this one very big proposal which was, you know, it was a very good thing to happen the way it was shaping up over the last seven, eight months.
Rajeev Maheshwari
Okay.
Sorab Agarwal
And we were nearly there. It was sort of done. But nevertheless I’m sure it will come back again but. But not in a hurry till such time.
Rajeev Maheshwari
So is it, is it still on with the. With a time gap or means it’s off the radar?
Sorab Agarwal
No, that the discussions were happening. Everything was in place. It has been suspected as of now till such time.
Rajeev Maheshwari
Okay. Okay. And. And the one final update I. I read in somewhere that the ministry is considering of putting tax on the construction equipment, Chinese imports and all. I read in somewhere. So is it coming into some discussion or reality or is it just a rumor or something like that?
Sorab Agarwal
Finally, I think the Indian government has understood that certain categories of machines and construction equipment are facing very stiff challenge from Chinese pricing. Subsidized pricing is the right word because you know, and India is at a price visibility of 30, 40% at least because of the sufferings and benefits they get in China apart from a 15, 20% lower commodity pricing for their self consumption within China. So government has been very active on that and they have been thinking of a lot of tariff and non tariff barriers. This article you are referring to is especially with focus to hydraulic excavators which are produced by Tata, Itachi, lnt, Kobatsu, Hyundai in the country.
Rajeev Maheshwari
Okay.
Sorab Agarwal
The government is serious on it and generally when Mr. Gadkari says something, he follows up upon it.
Rajeev Maheshwari
Yeah, yeah.
Sorab Agarwal
The government is looking at in all directions. One is, you know, tariff and non tariff how it is possible that the indigenous industry can grow faster and bigger. They are also, you know, to some extent looking at incentivizing the industry as they have incentivized other sectors. But I cannot say any more than that at this juncture, especially with respect to incentivization. In our own case last year we had initiated the DGTR proceedings with respect to Anti dumping duties on heavier and bigger cranes which are made in very few numbers in the country or not made.
That is also in the process. We were expecting it to finish by June. In July, all the final hearing submissions, everything has happened. So hopefully we should that should also see the light of day. Within August or latest by September, these.
Rajeev Maheshwari
Things fall in place in terms of the construction industry as a whole. Construction equipment. Just a minute, just final 30 seconds. And if these things formally happen in terms of the anti dumping dupe and so then it will be a really good boost for the domestic sector as well as our company as a whole in terms of reduced competition and more realization from the revenues.
Sorab Agarwal
Yes. Especially with respect to the Chinese machines where you know, our company faces stiff competition for crawler cranes and truck cranes.
Rajeev Maheshwari
Yeah.
Sorab Agarwal
And competition for tower cranes. Yes, it will be a very good scenario to be in. And you know, over the years, over the next 3, 4, 5 years it can lead to, to a 502,000 crores revenue addition only on account of these type of machines. And we are very hopeful all of this will go through. And you know, if you look at the excavator industry, Chinese entered five, seven years back and in four, five years, six years, they have taken 25, 30% market share. So if they are not checked today, they will go to 50, 60% and eventually they will make the Indian industry come.
Excavator industries have done in the past to our cell phones or other industries. You know, they take over prices, ridiculous credit terms. So it is a very good thing to happen that the government at the senior most level has taken notice of this and are proactively planning for this.
Rajeev Maheshwari
Okay. Right. Let’s hope this Swadeshi movements takes a leap and it helps everybody. That’s all from my side as to. It has TO thanks to Mr. Trump. It has to. Right. Thank you.
Sorab Agarwal
Yeah, thank you.
operator
Thank you. A reminder to the participants, please press star and one to ask a question. The next question is from the line of Ravi Swaminathan from Evandes Park. Please go ahead.
Unidentified Participant
So thanks a lot for taking my question. My, my question is regarding the growth which we had seen in the past five years had been stupendous. We had tripled our revenue over the next four, five years. What are the top two, three sectors that you think might be driving the growth for ACE and what kind of growth one should think of is the question that I have in my mind.
Sorab Agarwal
Obviously our growth is primarily driven by the manufacturing and the infra sector and obviously both of them are of you know prime importance and concern to the government. So hopefully we are in safe hands. Now that you know, the government especially with respect to the current geopolitical scenario and the tariff scenario. The only way for the government to spruce up the sentiment as and when it goes down or starts to dampen a little is to focus more on infrastructure because that is where they can do direct spending. And we anticipate, and we are very hopeful that and Mr.
Gadkari has already said three, four days back that you know, the spending on infrastructure projects is going to increase immediately. So hopefully all of that is going to gel well for us going forward in our country with respect to manufacturing and infrastructure because most of our machines are made and developed for this scenario and the government is definitely focused on the 2040, you know, 2047 Vixit Bharat. So that is not possible unless and until you know, self reliance and manufacturing is increased in the country coupled with focus on infrastructure and making world class infrastructure. You know one of the major disabilities India has as compared to China is also logistics cost which is higher than China.
So by improving infrastructure even the logistics cost goes down. Apart from that our focus on you know, more defense business and export markets will further help us grow a little, you know, in times to come. We have been doing that. Yes there has been this quarter has been a little slow on account of primarily, you know, pre buying and the cost factor and the technology factor. Such hiccups are sometimes good. They, you know, they wake you up, they bring you out of complacency, they check your agility. So I hope all of that happens.
Unidentified Participant
Got it sir. And private sector, I mean as of now it doesn’t fully fire like steel capex etc but if it does, can make a big delta to your top line, bottom line.
Sorab Agarwal
Yes, yes, definitely it will fire. It has to fire. You were talking about our growth. So we wanted to triple ourselves between, between FY23 and 26. And unfortunately we have, you know, a little slowness we had in the last year on account of elections and you know this year because of the emission norms or whatever but I’m sure one year here and there. So as conveyed even last time. So maybe it will not happen in three years shifting of our revenue, it will happen in four years FY23 to FY26. And then we had also thought or sorry, doubling and then we had also talked of tripling from FY23 dipling by FY28.
So maybe things can be get preponed, postponed by a year here and there. But I think as a country and as a company I think everything is moving in the right direction and all our medium term, long term things are pointing to growth and hopefully we are able to capitalize on that. And in the past, in the recent past as well included, we have increased our capacities. We are capable of 5000 crores plus we did close to 3300 crores. So we have excess capacity available. Apart from that we are operating on close to about 100 acres of land for future growth and expansion.
We have taken about 138 acres of land. So going forward first of all we have 30, 40% extra capacity available to increase our revenue without any capex, significant capex and then even for future capex after that we have most of the land available and land is one of the most costliest resources when you’re doing capex today. So I think we have put all our blocks in place. Things are looking good. So let’s see how it pans out.
Unidentified Participant
Got it sir. Thanks a lot.
operator
Thank you. The next question is from the line of Vinay Maheshwari from ige. Please go ahead.
Unidentified Participant
Hi. Thank you for the opportunity. Can you please elaborate some colors over the current capex going on and how could be the commissioning timelines.
Sorab Agarwal
For our capacity expansion which we had planned. Most of the capex has happened, is in place and our capacity is now revenue capacity is about a little over 5000 crores. But apart from that in the current year we have envisaged the capex of over 100 crores with respect to further modernization and upgradation and introducing more robotics etc. Into our setup so that we are able to compete in the global stage with respect to our export markets and also you know, bettering our products and quality for the Indian market. So that’s about a little over 100 crores and apart from that the land which I mentioned, we have to make some balance payments for those lands so that will be close to about 130 crores plus minus outflow that will happen in this year.
We did have plans to further increase our capacity, you know for a particular type of product which currently we have put on hold for the next three, four months. So you know, but yes we are continuing with the land development and the other part of it. I think the major part of that expansion should take shape in the next year. So that expansion, expansion is close to about I think 250 to 300 crores of capex. And but yes most of that will be happening in FY27 and FY28.
Unidentified Participant
Got it. Is there any particular area where we are facing any kind of bottleneck as of now?
Sorab Agarwal
Yes sir. The the market to come back to its same spirits. Nothing else for the markets to bounce back. And I’m sure it will happen because the festival season is a little early. So September onward things should be good. With respect to capacity, our readiness, our products, the upgradations within the products. I think we are totally geared up for the future and hope it is good as it has been in the past.
Unidentified Participant
Got it. And since you have to interrupt you.
operator
Sir, I will request you to join back the question queue for follow up questions as there are several participants waiting for that on. Thank you. We request the participant to limit your questions to one per participants. Thank you. The next question is from the line of Karthik from Multiple Equity. Please go ahead.
Unidentified Participant
Hello. Am I audible?
Sorab Agarwal
Yes, Karthik audible.
Unidentified Participant
Yeah. Thank you for this opportunity. So just wanted to understand one thing. If I want to when I look at City Wahan volumes, how do they, I mean how or what would be the time gap between wholesale dispatches and one registrations? Or they would be fairly one to one basis.
Sorab Agarwal
I think there is a lag of one to two months at least.
Unidentified Participant
Oh okay.
Sorab Agarwal
Minimum would be one month average put out. You can easily say 45 to 60 days because the goods they are delivered to the dealerships, then to the customer and then the registration application. So the Wahan data is representative but not of the current factual. It is with a lag of one and a half, two months.
Unidentified Participant
Okay. Okay, got it. Thank you so much. That’s it for myself. Thank you.
operator
Thank you. The next question is from the line of Kushal Duri from an individual investor. Please go ahead.
Unidentified Participant
Hello.
Sorab Agarwal
Yeah, hi.
Unidentified Participant
Hi. Hi sir. So my question is in relation to the previous one only. So for July the RTO data was showing volumes of some 577 units. So you mean to say that might be higher than the than what you have been displayed?
Sorab Agarwal
Let’s say July 577100 would mean machines which were delivered to customers, let’s say in June or within July. So this data is, you know, because sometimes registration happens immediately, sometimes it happened with a lag of 10, 15 days. Then sometimes at our end, let’s say the delivery to the dealership and the dealership holding some stock for some time. So it is skewed by one or two months. So very difficult to, you know, put a number to it. But maybe next time when we have a con call we Will figure out a correlation for the last 45 months.
Maybe that could be helpful to all of you.
Unidentified Participant
Thanks. But on a year on year basis has there been any change in the volume for month of July? Is it lower or same the volume numbers?
Sorab Agarwal
I really don’t have the July numbers but they were similar to June number for us.
Unidentified Participant
Okay.
Sorab Agarwal
Because July is the heaviest. You know the rains are at their, you know the fiercest and the peak of rains happens in July. So they were similar to June. But unfortunately we have numbers of June and before so we don’t have a July number right now.
Unidentified Participant
Thank you.
Vyom Agarwal
And Kushal Vyom decides. I would just like to add a little bit to the Wahan data. I mean one number which you and Karthik also asked. These are certain number of machines which we manufacture. They do not go on the Wahan data. So for example tower crane, they do not get registered. So our numbers will have a little bit of a disparity with respect to the Wahan data. And as sir said that there will be a lag. So Wahan data may not be the right or I would say the exact parameter to look at us because some of the machines which are not getting registered are also in our portfolio.
Sorab Agarwal
One data would be more significant signifying more of the retail sales, right?
Vyom Agarwal
Yes sir. It will be more or less the registration sale. Yeah. It will not have solar cranes and tower cranes and in fact some of the forklifts which we do and they are may be running inside of factory premise which may or may not be registered.
Sorab Agarwal
Even for some train people do not take registrations which are running inside closed premises.
Unidentified Participant
And sir, one last query from myself. Any. Any development on the registration of electric train.
operator
Hello.
Sorab Agarwal
Yeah, I’ll take that question and then we can.
operator
Yes sir, sure.
Sorab Agarwal
Yes, development is happening. Our approvals are pending with arai the CMBR authority. I think last hitch some excite battery approvals with respect to electric vehicles are pending at the end of exide. So we are hopeful it should get through quickly.
Unidentified Participant
Thanks a lot.
operator
Thank you. The next question is from the line of journal from prudent corporate advisory. Please go ahead.
Unidentified Participant
Yeah, am I audible?
Sorab Agarwal
Yes please.
Unidentified Participant
Yeah. So my question was regarding the industry outlook. So there are numerous forecast or something about the non agri segment of cranes construction agreement growing by around mid single digit to some forecasting by growing it by double digits or so. So what do you think these segments like cranes or construction equipment can grow industry. What can the industry grows and what can the company see in its volumes too.
Sorab Agarwal
In the beginning of our last call, you know, being a little conservative, we had projected 14 to 15% of growth. But looking at the current juncture and all the things, I think it would be prudent that we take this call by end of quarter two to give a more realistic picture and it would not be wise to come out with a number at this juncture. So once there is more clarity on every front, including the BS5 emission norms acceptance which has happened and the numbers will normalize and you know, the second half of the year will start, the numbers actually start to normalize.
The government’s focus coming back to infra, you know, all the basic things coming into place. So I think it won’t be prudent to give. But yes, one thing I can tell you for sure now just let’s forget our company for a second but let’s talk of the industry. The earth moving industry has been flat year on year for the first quarter the road machinery industry has been flat. The concrete or concrete carrying or concrete processing that has increased by about 16%. So that is more of civil structures and real estate. Plus plus plus the material processing is flat and cranes were a little down and the main reason was 50 horsepower and below, which is what we have been able to pinpoint at.
So you know, I would feel that we would like to answer that only at the end of September when the second quarter has, you know, gone by to be able to give you a more predictably correct answer.
Unidentified Participant
You said something about construction equipment or some segment growing by around 30% or so. You I sorry if I miss out.
Sorab Agarwal
16% that is the concrete industry. When I say concrete I’m talking of batching plants, concrete pumps, transit mixers. So the concrete part of the construction equipment industry has grown by about 16% in the last quarter, year on year.
Unidentified Participant
So that’s it.
operator
Thank you. A reminder to the participants, please press star and one to ask a question. The next question is from the line of Punit Zaveri from Zaveri and Company. Please go ahead.
Unidentified Participant
Thanks so much for the opportunity again for this one question. You mentioned that of course the guidance will come at the end of Q2, so we’ll wait for that. But your previous plan was of course double revenues to roughly about 4400 crores in FY26 and 5500 crores in FY27. But given your capacity roughly about of 5000 crores revenue, when should we expect the additional, if any capacity that you will need? Because by FY27 you will be very close to almost 95% utilization. So is the 100 crore capex number of this year including that or do you believe we have to do a lot more gatex either at the end of this year or the start of next year to get to additional revenue capacity of 5,500 crores and above? That’s the only question.
Sorab Agarwal
Yeah, I just, you know, for the first part of your question. So hopefully this 4400 crores instead of FY26 would happen by FY27 which I clarified even in the last call. Tripling from our FY23 revenue and taking it to 6600 crores should happen by FY29. So that means we have capacity enough capacity till FY27 that is end of next year, end of next financial year. So but in any case in the next year we will start to expand our capacity which I did mention making a new plant for particular type of production tree so which will give us an additional revenue of maybe around close to 1500 crores plus minus but that we start to do next year.
Earlier we were thinking of starting to do it in the second half of this year but we start to do it next year once you know, there’s more certainty because today already we have 55,000 crores worth of capacity and you know, generally for us keeping the land parked which we have more or less acquired. So let’s say 100 crore investment can generate about 800 to 900 crores worth of revenue for us. Right? Vom, that is how it works out. Vyom, you’re there. I think we lost vom. So about 100 crore capex can lead to 800.
Vyom Agarwal
Yes sir, you are right.
Sorab Agarwal
Revenue capability is about 8, 9 times which we will start to exercise in the next year again looking at the scenario.
Unidentified Participant
Got it sir. But so essentially you, you because you mentioned that you know you’re at least over 14 to 15% growth this year and of course you’ll revise it. So I just thought that you were a little conservative because 40, you already done 3,400 crore of revenue in FY25 and even a 15 growth before 4,000 crores. So the, the guidance of 4,400 crores by FY27 just seems very conservative because you should be able to touch 5000 crores at a minimal growth rate as well. Right, so that’s where the question was coming from. But thanks so much for the clarification.
Sorab Agarwal
Yeah, things are a little different from what they were perceived. So keeping everything in mind. But you can be rest assured we will leave those turn on tone in terms of, you know, doing a more revenue and losing it out on account of capex or capacity. I think we are very well geared for that in our minds and we will deploy our money as soon as possible, as fast as possible, as soon as the opportunity is there. So you should be very comfortable from that aspect and we have enough soft to make sure that we don’t lose out on the market share or the growth potential.
Unidentified Participant
Got it? Got it. So thanks so much for your opportunity.
operator
Thank you ladies and gentlemen, as there are no further questions, I now hand the confidence over to Mr. Ravi Swaminathan for closing. For closing comments.
Unidentified Participant
Thanks a lot everyone. On behalf of Spark, we will conclude today’s call. We thank you all for joining us and you made connect your likes. Thank you.
Sorab Agarwal
Thank you everybody. Thanks a lot. Bye bye.
operator
Thank you.
Unidentified Speaker
Thank you. Thank you everyone. Thank you. Thank you Sia. Thanks.
operator
Ladies and gentlemen, on behalf of Avendis park and Action Construction Equipment Ltd. That concludes this conference, thank you for joining us and you may now disconnect your lines.