ACE vs Escorts Kubota: Leading the Indian Construction Equipment Market
Explore the competition between Action Construction Equipment Limited and Escorts Kubota Limited in the Indian construction equipment market, analyzing their market positions, financial performance, and future plans.
Construction EquipmentMarket CompetitionIndian IndustryFinancial PerformanceCapex PlansReal Estate NewsOct 04, 2025
The Centre is working on a programme to encourage local production of construction equipment, aiming to address gaps in infrastructure development. Initial proposals focus on supporting the indigenisation of construction equipment, tunnel boring machines, and cranes.
Currently, India’s mining and construction equipment sector imports nearly half of its components by value from countries including China, Japan, South Korea, and Germany, highlighting the sector’s dependence on imports.
When discussing the construction equipment space, two prominent names that often come to mind are Action Construction Equipment Limited and Escorts Kubota Limited. But how do these companies differ, and which one holds a stronger position in the sector? This article delves into their key distinctions, highlighting how each player is contributing to and leveraging opportunities in the construction equipment industry.
Price Movement
With a market cap of Rs. 12,686 crores, shares of Action Construction Equipment Limited (ACE) moved up by nearly 1 percent on BSE to Rs. 1,080.65 on Friday. The stock has delivered negative returns of around 21 percent in one year.
Meanwhile, shares of Escorts Kubota Limited declined nearly 1.5 percent on BSE to Rs. 3,583.40 on Friday, with a market cap of Rs. 40,090 crores. The stock has delivered negative returns of around 14 percent in one year.
Company Overview & Product Portfolio
Action Construction Equipment Limited has a significant presence across diversified sectors like construction, infrastructure, manufacturing, logistics, and agriculture.
The company is engaged in the business of manufacturing and marketing of Hydraulic Mobile Cranes, Mobile Tower Cranes, Crawler Cranes, Truck Mounted Cranes, Material Handling Equipment like Forklifts, Road Construction Equipment like Backhoe loaders, Compactors, Motor graders, and Agriculture Equipment like Tractors, Harvesters, Rotavators, etc. The Company has manufacturing facilities in Haryana.
The company is the world’s largest manufacturer of Pick & Carry cranes, commanding over 63 percent market share in India’s mobile crane segment. It also holds a leading 60 percent share in the domestic tower crane market. Its end-user sector exposure is well diversified, with approximately 45 percent in Manufacturing & Logistics, 35 percent in Infrastructure, 13 percent in Real Estate, and 7 percent in Agriculture.
Escorts Kubota Limited is primarily engaged in the business of manufacturing of agricultural tractors, engines for agricultural tractors, construction, earth moving and material handling equipment, round and flat tubes, heating elements, double acting hydraulic shock absorbers for railways coaches, centre buffer couplers, automobile shock absorbers, telescopic front fork & Mcpherson struts, brake block, internal combustion engines, and all types of brake used by railways.
The company also trades in oils & lubricants, implements, trailers, tractors, compressor accessories and spares, construction, earth moving and material handling equipment. It holds an 11.8 percent market share in the domestic tractor market.
Financials & Revenue Segmentation
In Q1 FY26, ACE experienced a decline in the revenue from operation of Rs. 652 crores, a decrease of around 32 percent QoQ and 11 percent YoY. Meanwhile, its net profit stood at Rs. 98 crores, representing a decline of around 18 percent QoQ but a growth of about 17 percent YoY. Between FY22 and FY25, ACE revenue grew at a 3-year CAGR of nearly 27 percent, while net profit surged at a CAGR of ~57 percent.
In Q1 FY26, ACE derived around 93 percent of its consolidated revenue from Cranes, Material Handling and Construction Equipment, and the remaining 7 percent from Agriculture Equipment.
On the other hand, Escorts Kubota reported a revenue from operations of Rs. 2,500 crores, a marginal rise of around 2 percent QoQ but a decline of about 3 percent YoY. Meanwhile, its net profit stood at Rs. 1,397 crores, representing an impressive rise of around 339 percent QoQ and 363 percent YoY. The company’s revenue grew at a 3-year CAGR of nearly 12 percent, while net profit surged at a CAGR of ~20 percent, between the period of FY22 and FY25.
During the same period, Escorts Kubota derived nearly 88 percent of its consolidated revenue from its agri-machinery division, with the balance 12 percent contributed by construction equipment.
Management Outlook & Capex Plans
The management of ACE has withheld full-year guidance due to near-term uncertainties. Updates are expected after Q2 or post-monsoon, depending on the macroeconomic environment, resolution of geopolitical factors, and festive season sales trends.
Previously, ACE had targeted a doubling of revenues from FY23 to FY26 (around Rs. 4,400 crore); this milestone is now anticipated by FY27, with tripling (about Rs. 6,600 crore) projected by FY29.
On the capacity front, ACE has the infrastructure to support revenues of up to Rs. 5,000 crore. Major expansion projects are already in place. For the current year, Rs. 100 crore is allocated for modernization and robotics upgrades, along with Rs. 130 crore towards land payments. The next major greenfield expansion, estimated at Rs. 250-300 crore, has been deferred to FY27-28. Management emphasized strong capital efficiency, noting that Rs. 100 crore of capex can potentially generate Rs. 800-900 crore of incremental revenue.
As for Escorts Kubota, the planned greenfield plant in Uttar Pradesh has faced a six-month delay in land acquisition due to government and farmer-related issues. Completion is now expected in FY26, with construction likely to begin in FY27. For FY26, the company has guided for Rs. 350–400 crore in capex (excluding land acquisition costs for the UP plant), focusing on organic growth.
Management remains optimistic, supported by strong prospects in exports, new product launches, and medium-term margin recovery. However, a cautious stance has been maintained regarding commodity cost pressures (notably metals from Q2), regional industry fluctuations, and the slow pace of farm mechanisation reforms.
Strategically, Escorts Kubota plans to strengthen product innovation, expand distribution into underpenetrated markets, leverage Kubota’s global network, and accelerate growth in non-tractor segments.
Frequently Asked Questions
What is the proposed incentive scheme for the construction equipment sector?
The Ministry of Heavy Industries has proposed a Rs. 13,000-crore incentive scheme to support domestic manufacturing and reduce import dependence in the construction equipment sector.
What is the market cap of Action Construction Equipment Limited (ACE)?
The market cap of Action Construction Equipment Limited (ACE) is Rs. 12,686 crores.
What percentage of its revenue does Escorts Kubota derive from its agri-machinery division?
Escorts Kubota derives nearly 88 percent of its consolidated revenue from its agri-machinery division.
What are the key sectors where ACE has a significant presence?
ACE has a significant presence in construction, infrastructure, manufacturing, logistics, and agriculture.
What is the planned capex for Escorts Kubota for FY26?
Escorts Kubota has guided for Rs. 350–400 crore in capex for FY26, excluding land acquisition costs for the UP plant.
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