Kirloskar Oil Engines (KIRLOSENG) Q2 24/25 earnings summary

Executive summary

• Standalone and consolidated Q2 FY25 results showed strong revenue and profit growth, with standalone net sales up 13% YoY and consolidated revenue reaching INR 1,500 crore, driven by B2B demand and margin expansion.

• H1 FY25 revenue reached INR 2,518 crore (standalone) and INR 3,109 crore (consolidated), with EBITDA margin at 12.7% and PAT growth supported by a healthy net cash position.

• The new Sanand facility consolidated five plants, aiming for cost efficiencies and growth.

• The 2X-3Y strategy targets doubling revenue in three years to INR 6,500 crore, with double-digit EBITDA margins.

• Appointment of Ms. Farah Irani as Company Secretary and key managerial personnel effective November 2024.

Financial highlights

• Standalone Q2 FY25 net sales: INR 1,184 crore (13% YoY growth); EBITDA: INR 148 crore (35% YoY growth); EBITDA margin: 12%-12.9%.

• Standalone Q2 FY25 net profit: INR 98 crore (48% YoY growth); consolidated Q2 FY25 net profit: INR 123.89 crore.

• H1 FY25 standalone net profit: INR 244.20 crore; consolidated net profit: INR 279.46 crore.

• Financial services Q2 FY25 revenue: INR 195 crore (54% YoY growth); AUM at INR 6,284 crore.

• Standalone net cash position at INR 213 crore as of Q2 FY25.

Outlook and guidance

• Management remains committed to aspirational revenue targets, with a long-term ambition to reach $2 billion consolidated revenue in five years.

• Market dynamics in Powergen expected to evolve as more players enter CPCB IV; pricing and margins being closely monitored.

• Export growth expected to improve in H2, despite challenges in key markets like South Africa.

• Board and audit committee have reviewed and approved the results, with no adverse auditor remarks.