ACE hikes prices 9-12% to fight 22% steel cost jump
Three rounds of price increases are absorbing a 20-22% surge in steel, which makes up 65% of inputs. The company also finalised its Kato Works JV.
— 2 earlier stories on Action Construction Equipment Ltd. →What's new
- ACE executed three rounds of price increases totalling 9-12% to counter a 20-22% surge in steel costs.
- The company finalised its 50-50 JV with Japan's Kato Works to manufacture heavy truck and crawler cranes.
- Defence revenue target for FY27 is ₹200-220 crore, backed by a ₹575 crore order book.
Why this matters
The pricing actions show management is actively defending margins as its largest input cost balloons. The formalised Kato Works JV and the ₹575 crore defence order book are concrete steps toward the ₹6,000-6,200 crore medium-term revenue goal.
What we're watching
- Whether the price hikes hold without hurting demand, especially in price-sensitive segments.
- Progress at the Kato Works JV, with a target of ₹300 crore revenue in 3-4 years.
- Execution on the ₹200 crore capex plan and the evaluation of a ₹400 crore tower crane factory.
The full read
Action Construction Equipment is spending its way through a steel cost crisis. The company has raised prices three times, for a cumulative 9-12% increase, to fight a 20-22% spike in steel, which eats 65% of its inputs. Management said this has protected margins so far. The other big news is the finalisation of its 50-50 JV with Japan's Kato Works. The partnership targets ₹300 crore in revenue from heavy cranes over three to four years. Defence is another pillar: ACE is targeting ₹200-220 crore in revenue this year, underpinned by a ₹575 crore order book. The company is also planning ₹200 crore in capex and is weighing a ₹400 crore tower crane factory. All of this feeds into the ₹6,000-6,200 crore revenue target for FY29-30. The price hikes are a direct, defensive move. The JV and defence push are the offensive plays.
Questions answered
- How has ACE dealt with the steel cost spike?
- The company implemented three rounds of price increases, cumulating to 9-12%, to offset a 20-22% surge in steel costs, which represent 65% of its input expenses.
- What is the status of the Kato Works joint venture?
- ACE has finalised the 50-50 joint venture with Japan's Kato Works to manufacture heavy truck cranes and crawler cranes. The target is ₹300 crore in revenue from the JV over three to four years.
- What is the company's defence business outlook?
- ACE has set a defence revenue target of ₹200-220 crore for the current financial year. This is supported by an existing order book of ₹575 crore.
- What are the medium-term financial targets?
- Management reiterated a medium-term revenue goal of ₹6,000-6,200 crore by FY29-30. For the current year, it has committed ₹200 crore to capex and is evaluating a ₹400 crore tower crane factory.
Action Construction Equipment Ltd.
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All notes on ACE →- 26 May 2026 · 3:04 PM IST ACE hikes prices 9-12% to fight 22% steel cost jump
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