Kirloskar Brothers Limited Q1 FY27 Earnings Conference Call Transcript

Conference Call Date: August 03, 2026

Management Participants

  • Mr. Sanjay Kirloskar – Chairman and Managing Director
  • Mr. Alok Kirloskar – Managing Director, Kirloskar Brothers International B.V.
  • Ms. Rama Kirloskar – Joint Managing Director, KBL and Managing Director, Kirloskar Ebara Pumps Limited
  • Mr. Bhavesh Chheda – Chief Financial Officer
  • Mr. Devang Trivedi – Company Secretary

Q1 FY27 Financial Performance Highlights

Consolidated Performance:

  • Revenue: ₹11,049 million, representing 13% year-on-year growth
  • EBITDA: ₹1,306 million, with 2% year-on-year growth
  • EBITDA Margin: 11.8%
  • Order Intake: ₹13,954 million, showing 4% year-on-year growth

Standalone Domestic Business:

  • Revenue: ₹6,738 million, showing 9% year-on-year growth
  • EBITDA: ₹920 million, with 16% year-on-year growth
  • Profit After Tax: ₹540 million, reflecting 15% year-on-year growth
  • Order Intake Growth: 5.4% year-on-year (corrected from initial 14.9% statement)

International Business:

  • Revenue Growth: 19% year-on-year
  • EBITDA: ₹207 million
  • EBITDA Margin: 5.1%
  • Primary drivers: Strong execution across SPP USA and Kirloskar Brothers Thailand Limited

Order Book Position

Domestic Pending Orders (as of June 2026):

  • ₹25,577 million (excluding small pump order book)
  • Strong pipeline across segments

International Pending Orders:

  • ₹15,045 million
  • Provides strong visibility for coming quarters

Segment-wise Order Book Breakdown (Standalone)

  • Power: ₹6,000 million (approximately 30% growth)
  • Oil & Gas: ₹1,500 million
  • Building & Construction: ₹2,320 million
  • Water: ₹4,800 million
  • Industry: ₹1,497 million (corrected from initial ₹556 million)
  • Marine & Defense: ₹556 million
  • Customer Support & Engineering Services: ₹2,320 million

Business Segment Updates

Oil & Gas Segment:

  • Received petrol pump orders totaling approximately ₹217 crores for ~22,000 pumps
  • Executed ₹74 crores dispatch from previous orders
  • Orders subject to customer acceptance timing

Power Segment:

  • Strong growth in nuclear power plant orders
  • Received primary circuit pump orders worth ~₹70 crores
  • Secondary circuit orders worth ~₹40 crores
  • Also supplying to new thermal power plants

Data Center Business (International):

  • SPP USA showing strong traction in data centers, fire and HVAC projects
  • Growing about 20+% quarter-to-quarter
  • Finalizing multinational framework contract with major US data center operator
  • Package value for hyperscale data centers: USD 7.5-12 million per project
  • Addressing approximately 4,000 operating and 2,000 planned data centers in US

International Subsidiaries Performance:

  • SPP UK: Margin moderation due to lower services contribution from chemical/petrochemical sector affected by high energy prices
  • Rodelta: Losses due to delayed execution; expected improvement in next 2 quarters
  • Improvement expected from Q3 for SPP UK (Q2 for India) as service contracts with power plants and water utilities come into effect

Operational Updates

Foundry Modernization:

  • Completed foundry improvement exercise
  • Inventory buildup (₹82 crores in Q1) due to partially completed orders
  • Significant improvements expected in current quarter
  • Enabling faster order execution going forward

KPML Performance:

  • Margin decline from 12.5% to 7.3% due to merger with loss-making TKSL (Kolhapur Steel)
  • TKSL turnaround expected as output increases
  • TKSL supplies steel castings for power (thermal/nuclear) pumps and to BHEL

IoT and Digital Initiatives:

  • Developed second version of IoT devices with reduced cost
  • Multiple pumps can now connect to single device
  • Hundreds of installations currently operational
  • Strong traction in municipal water and irrigation projects
  • Only company in India offering such solutions for government tenders

Guidance and Outlook

Revenue Growth:

  • Confident of delivering double-digit revenue growth in FY27 over FY26 for standalone business
  • Striving for double-digit growth on consolidated basis

Margin Outlook:

  • Expect margin improvement in international business as service portfolio expands
  • Price hikes of approximately 10% since January sufficient to cover raw material costs
  • Customer Support & Engineering Services orders expected to improve standalone EBITDA margins

Order Execution:

  • Expect to execute approximately two-thirds of domestic order book in FY27
  • Small pump business (45-50% of business) has no order book as orders are delivered same month

Technology and Market Position

Concrete Volute Pumps:

  • Company claims to be world's largest manufacturer of concrete volute pumps
  • Superior performance with only 2% efficiency drop over 30 years in seawater applications
  • Promoting based on lowest life cycle cost compared to vertical turbine pumps

Nuclear Pump Development:

  • Very close to receiving orders after tender process
  • Hydraulic performance proved superior to promises
  • Mechanical performance proved
  • Metallurgical trials ongoing with European and Indian foundries
  • Expected clarity by middle or end of current month
  • 100% market share in metallic volute pumps for nuclear plants

Capital Expenditure

  • Normal capex equal to depreciation

-主要用于现代化、消除瓶颈和质量要求

Forward-Looking Statements

Management expressed optimism about growth trajectory backed by healthy mix of domestic and international business, robust order pipeline, and focus on operational excellence. The company is well positioned to deliver sustainable growth.