Action Const.Eq. (ACE)

FairStock Score: 69/100 — STEADY

Score breakdown: P/E: 1/3 · ROCE: 2/2 · Growth: 1/2 · Dividend: 0/1

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

At ₹917, Action Const.Eq. looks like a good business but not a good investment. The balance sheet is conservative: debt-equity is 0.01, Altman Z is 4.70, and Piotroski score is 7/9. Promoter holding at 65.42% also aligns ownership with minority shareholders. I admire the returns on capital—ROE of 26.18% and ROCE of 40.11% are far above what most companies earn. But Graham taught me to pay for value, not quality alone. Sales growth is only 0.31%, profit growth 8.65%, and the resulting PEG is 4.33. At a P/E of 24.92 and P/B of 6.76, I am being asked to pay a rich price for a very modest growth outlook. The Graham Number is ₹329.01, the DCF value is ₹31.00, and the margin of safety is deeply negative at -168.90%. Those numbers do not support ₹917.25. Free cash flow of ₹30 Cr is also far below net profit of ₹116 Cr, so earnings quality needs questioning. A dividend yield of 0.23% means I am not being compensated to wait. Construction vehicles are inherently cyclical, yet the market seems to be pricing this as a steady compounder while topline is flat. I would wait for a much better price, or for evidence that volume growth and cash conversion have genuinely improved. In investing, you do not need to swing at every pitch; this one does not offer enough margin of safety.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer