The shares of the leading Diesel Engine and Generator Set manufacturer gained up to 5 percent after the company received significant orders from the Indian Navy worth Rs 270 crore.
Price movement
With a market capitalization of Rs 10,931.27 crore, the shares of Kirloskar Oil Engines Ltd were trading at Rs 752.95 per share, increasing around 2.62 percent as compared to the previous closing price of Rs 729.20 apiece.
Reason for Rise
The shares of Kirloskar Oil Engines Ltd have seen bullish movement after receiving a prestigious order from the Ministry of Defence, Government of India, represented by the Indian Navy for the Design and Development of Medium Speed Marine Diesel Engine of 6MW Capacity under the Make-I scheme.
Management Comment
Gauri Kirloskar, Managing Director, Kirloskar Oil Engines, said ‘We are honoured to be selected by the Indian Navy for this prestigious project and to have the opportunity to contribute to the building of our nation. This is a proud moment for all of us at KOEL, and I am sure that with the technical and R&D strength that we have, we will be able to deliver yet another world-class product to the Indian Navy. We would like to thank the Ministry of Defence and the Indian Navy for their support and guidance.’
Financial Performance
The company reported a zoom of 5 percent YoY in revenue from operations from Rs 1,391 crore in Q3FY24 to Rs 1,454 crore in Q3FY25. Their Net profits also declined by 24 percent YoY from Rs 89 Crore to Rs 68 crore over the same period.
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Operational insight
Kirloskar Oil Engines Ltd reported subdued Q3 FY25 results, mainly due to weak Power Gen performance. LMHP demand fell post-CPCB IV transition but is expected to recover. The market share decline is seen as temporary. Meanwhile, HHP demand remains strong, with a gradual market share improvement.
Product Developments
Kirloskar Power Gen now offers gensets from 3 kVA to 3,000 kVA, with its Optiprime range receiving strong market feedback. The company completed its transition to a single plant in Sanand, ramping up production and improving operational efficiency for enhanced value and performance.
Segment Performance
The company reported mixed segment performance: B2B Power Gen sales fell 2 percent YoY to Rs 418 crores, while the industrial segment grew 16 percent to Rs 268 crores. Distribution and aftermarket saw 15 percent growth, but Farm Mechanization sales dropped 50 percent to Rs 9 crores due to a strategic shift.
Future Outlook
Management is confident in recovering market positions and improving margins as demand normalizes. Strategic focus remains on high horsepower and international expansion. Operational efficiencies from the plant transition are expected to boost next quarter. The Board approved a 125% interim dividend, reflecting financial stability.
Company snapshort
KOEL, one of the flagship companies of the Kirloskar group, manufactures and services diesel engines and diesel generator sets. The company also makes diesel, petrol, and kerosene-based pump sets. It has manufacturing units in Pune, Kagal, and Nashik. The company caters to the agriculture, power generation, and industrial sectors.
Written by Abhishek Singh
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