Kirloskar Oil Engines (KIRLOSENG) Q3 24/25 earnings summary

Executive summary

• Q3 FY25 saw subdued results in the power gen business due to CPCB IV+ emission norm changes, impacting low and medium horsepower segments, while high horsepower demand remained strong and market share improved.

• B2C business completed a major plant consolidation, causing temporary production disruption but now fully operational.

• International business faced a slowdown due to absence of last year's one-time orders and ongoing restructuring; focus remains on building sustainable channels.

• Achieved 7% YTD FY25 standalone revenue growth to ₹3,672 crore, with consolidated sales up 9% to ₹4,558 crore and PAT up 7.7% to ₹307 crore.

• Interim dividend of ₹2.50 per share (125%) declared, with payment by 12th March 2025.

Financial highlights

• Standalone Q3 FY25 revenue grew 3% YoY to ₹1,154 crore; EBITDA at ₹117 crore (10.1% margin), net profit at ₹65 crore, down 17% YoY.

• Nine-month standalone sales at ₹3,700.86 crore, up 7% YoY; consolidated revenue at ₹4,596.24 crore; standalone net profit at ₹310.80 crore, consolidated net profit at ₹349.26 crore.

• Consolidated Q3 FY25 revenue at ₹1,453.70 crore, up 4% YoY; net profit at ₹89.39 crore, down from ₹104.02 crore YoY.

• Financial services segment revenue grew 43% YoY to ₹212 crore; AUM at ₹6,740 crore.

• Standalone and consolidated EPS for Q3: ₹4.48 and ₹4.91, respectively.

Outlook and guidance

• Demand for low and medium horsepower gensets expected to recover to pre-norm change levels in coming quarters.

• Management anticipates improved performance in Q4 as production normalizes and market stabilizes.

• Focus on high horsepower, international business, aftermarket growth, and long-term ambition to reach $2 billion consolidated revenue in five years.

• Continued investment in capacity utilization, product portfolio, and technology roadmap.