kirloskar brothers ltd. financial analysts meet quarter 2 ... meet/100241_20101028.pdf · vertical...

1This is a proprietary document of Kirloskar Brothers Ltd.

Kirloskar Brothers Ltd.

Financial Analysts Meet

Quarter 2

FY 2010-11

28th

October, 2010

This is a proprietary document of Kirloskar Brothers Ltd.

Companywide

Highlights

2

Projects in Andhra Pradesh put on hold for 5-6 months

due to political reasons, leading to lower sales thereby

causing loss of profits

Slow down in project booking due to management

decision of being selective in accepting orders –

pending orders as on Sep-10 for project sectors was

Rs.31,831 million, as against Rs.32,814 million as on

Jun-10


Irrigation

Highlights

3

• Manufacturing & delivery of all items (including 250 DG

Sets, 250 Panels & misc items) under the Lot 1 of the

Senegal Project.

• Commissioning of one pumping unit for the Ainapur

Project, Karnataka

• Whole system commissioned and water supplied to final

destination as per contractual commitment for Godavari

project, Andhra Pradesh

• Reformed project processes and focused on products


Water Resource Management

Highlights

4

• Expression of Interest for recycling project of waste water

submitted to PCMC and DJB on BOOT basis.

• Assessment of KBL capability for desalination pumps by Fisia, Italy.

• Largest pumps (6Nos SHL 750/110) supplied to UP Jalanigam for

sewerage pumping project.

• KWA Meenad, Vadodara STP, Vinzol SPS and HADUC Vietnam

projects successfully commissioned.

• Interest free initial advance of Rs. 200 million collected against BG

for BWSSB project and detailed engineering in advanced stage.


Power

Highlights

5

• Achieved the commissioning target of 2 x 500 MW Jhajjar Super

Thermal Power Project of NTPC for Common Wealth Games.

• Successful completion of Performance Guarantee Test for 3.6 MW

Vertical Kaplan Hydel Turbine of Zho Suwei Project ,Taiwan.

• Erection commenced for CW System package for 5x800MW CGPL -

India's first Ultra mega power project

• Undertaken market survey for pumps in Power Sector in Domestic

Market by Business Development Bureau

• Discussion / meeting with authorized Nuclear Inspection agencies

completed for ASME -N Stamp approval which will enable KBL to

participate in the Nuclear Power Industry worldwide.


Oil & Gas

Highlights

• Order booking shortfall in Q1 has been made up in Q2

• Rs.7.6 million liquidated damages recovered from Reliance

Industries Ltd., out of Rs.11.7 million

• Cooling water pumps commissioned successfully at BPCL

Kochi

6


Marine & Defence

Highlights

• IRS works approval for KOV completed and certificate awaited

• Declared L1 by Alcock Ashdown for submersible salvage

pumps for Indian Navy order value of Rs.19 million

• Maiden vertical Self Priming pump has been tested

successfully

• Registration with Hoogly Dock and GRSE for valves completed

• IRS certification being planned for KON in quarter Q3

7


Industry

Highlights

8

• Breakthrough order Rs.30 million in Industry Export from Japan Gas

Co. and Chiyoda, Japan JV

• Industry sector has booked 1st

breakthrough order in India for mine

dewatering application from Kolkata Regional office based on SPP’s

Autoprime design

• KPD thermic fluid pumps positioning done and orders received.

• Approximately 30 seminars and training conducted for consultants

and customers in H1, significantly more than that conducted in the

same period last year.


Building and Construction

Highlights

9

• Nationwide training for key customers leading to approvals by HVAC

and HYPN consultants.

• Consultants (Spectral, Fairwood, Shekhar Dey, etc.) approvals

received due to improved focus.

• Approval by German consultants TILKE & Jaypee Group for the

Formula One track, Greater Noida.

• Good relationship management with OEM’s such as Sterling Wilson,

Extinct Fire, L&T has resulted in KBL getting price preference.


Distribution

Highlights

10

• Total 45 New Dealers appointed.

• Good response from the off season scheme – growth

seen in almost every product group with special focus

was on submersible pumps.

• Energy Savings of KBL Pump over Anson Pump proved

to International Institute for Energy Conservation,

Mumbai.


Customer Support and Service

Highlights

11

• Repeat orders received from Neyveli Lignite Corporation

and Tata Power Company Ltd.

• Rate Contract for spares has been implemented in major

coal fields.

• Complaint registration through toll free number introduced.

• Complaint resolution time for Dewas and Shirval products

brought down to 3 days from 7 days.


Kirloskarvadi Factory

Highlights

12

• FM_UL facility upgraded to global standards.

• Completed development of Canned Motor Pump for Indian

Navy.

• MOST implementation progressing as per plan.

• Lean successfully implemented in DB & CE.

• Commencement of Andhra Pradesh dispatches helped

liquidate June accumulated inventory.


Dewas and Shirval Factories

Highlights

13

• Construction activities for Coimbatore plant started.

• Over 70% y-o-y growth in production of pumps in H1.

• KANBAN system for bought out items and castings started.


Kondhapuri Factory

Highlights

14

• Dispatch ahead of plan

• Completed POD test for 600 mm BFV integral ebonite

lined seat.

• KONDHAPURI team made an innovation of "Tamper Proof

Kinetic Air Valve”.


Companywide

Pending Orders

Sector 2Q 1Q %

(Rs. million) Sep-10 Mar-10

Irrigation (IRR) 17,809.7 18,112.9 51.8%

Water Resource Management (WRM) 4,574.0 4,838.5 13.3%

Power (POW) 9,447.7 9,890.0 27.5%

Oil & Gas (O&G) 1,089.2 927.3 3.2%

Marine & Defence (M&D) 86.9 79.8 0.3%

Industry (IND) 597.3 781.0 1.7%

Building & Construction (B&C) 237.6 177.0 0.7%

Distribution (DIS) 158.5 114.0 0.5%

Customer Service & Support (CSS) 377.0 305.0 1.1%

TOTAL 34,377.9 35,225.4 100.0%

IRR52%

WRM13%

POW28%

O&G3%

IND2%

B&C1%

M&D0% DIS

0%CSS1%

Pending Orders

IRR WRM POW

O&G IND B&C

M&D DIS CSS

15


Companywide

Major Orders

Sector Order Type Customer Value

(Rs. million)

Irrigation Electromechanical portion of various

irrigation projects

Government of Karnataka 155.0

Water Resource Management 100MLD WTP Kalyan Dombivali Municipal Corporation 154.0

Power CW Pump packages Various private power companies 234.1

Oil & Gas 10 nos. VT Fire water pump package ONGC Mangalore Petrochemical Ltd. 39.4

Marine & Defence Dewas Range SP1HM in Gun Metal KPCL 4.9

Industry Assorted project pumps JGC Japan 30.0

Building & Construction FMUL Listed Fire pump sets John Deere 8.7

Distribution 200 EEC ( Corrocoated ) series Pumps PHED, Rajashthan 9.0

Customer Support & Service Supply of Spares for BHQ 95 D Ratnagiri Gas & Power Pvt Ltd 51.0

Total orders received by KBL during 2Q FY 10-11 amounted to Rs. 2,394 million

16


Sales :

• Total sales are at Rs. 834 Crs as against Rs.950 Crs in PY - drop of 12%.

• All marketing sectors have crossed sales over previous year except

Irrigation and Water sector

• Fall in Irrigation sector sales is Rs. 245 Crs since we stopped work for

Andhra Pradesh Projects due to non recovery of money. Now all due money

is recovered and we have commenced work in Andhra Pradesh subject to a

maximum cap on amount recoverable

• In the case of Water Sector, work on the BWSSB order did not commence

due to delay in receipt of order from Karnataka

• KBL was selective with orders and execution to improve sales mix,

which resulted in share of own product sales to total sales going up to 51%

as against 42% in the previous year.

HALF YEARLY FINANCIALS

Standalone Highlights


Sales :

• We had planned execution of Senegal export order in Q2 (Rs. 370 M).

However, we were able to dispatch Rs. 248 M in Q2 and the balance will be

dispatched in Q3.

• So also, of the 3 projects we made efforts to cross the POC threshold in

Q2, only 2 crossed the same.

• In the current year, threshold limit for POC recognition has increased to

50% from the erstwhile 35%

• There are few projects where planned execution has shifted to H2 FY11.




PBT :

• PBT has come down to Rs. 36 Crs ( 4% of Total Income ) as compared to

Rs. 56 Crs ( 6% of Total Income) in PY.

• Reduction in profit is mainly due to reduction in Sales & increase in

threshold limit for POC recognition to 50% from 35%

• We are closely tracking the status of around 10 projects for crossing POC

level in H2 FY11

• We currently estimate that FY11 sales will be more or less same as that of

FY10 but with a better profit




HALF YEARLY KEY FINANCIALS –

Standalone

( Rs in Crores )

Particulars

Sep-10 Sep-09 Sep-08

KEY FINANCIALS

Total Income 841 962 813 2,066

P B D I T 65 90 45 233

P B T 36 58 24 173

P A T 24 39 19 118

CASH PROFIT 38 51 29 144

KEY FINANCIAL RATIOS

P B I D T % AGE 7.7% 9.3% 5.5% 11.3%

P B T % AGE 4.2% 6.0% 3.0% 8.4%

R O C E % AGE 8.3% 15.2% 7.0% 19.2%

Half Year Ending Year Ended

Mar 31,

2010


HALF YEARLY KEY FINANCIALS -

Consolidated

( Rs in Crores )

Particulars

Sep-10 Sep-09 Sep-08

KEY FINANCIALS

Total Income 1,179 1,269 1,076 2,680

P B D I T 94 120 53 276

P B T 56 75 36 192

P A T 34 48 24 113

CASH PROFIT 54 67 38 152

KEY FINANCIAL RATIOS

P B I D T % AGE 8.0% 9.4% 4.9% 10.3%

P B T % AGE 4.8% 5.9% 3.3% 7.2%

R O C E % AGE 9.9% 16.6% 8.7% 18.9%

Half Year Ending Year Ended

Mar 31,

2010


THANK YOU

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