Kirloskar Oil slips 11% on weak Q3; mgmt expects demand revival in few qtrs

Kirloskar Oil Engines shares plunged 11.5 per cent on Wednesday, hitting 52-week low at Rs 691.05 per share on BSE. The selling of the stock came after the company posted 21 per cent decline in consolidated net profit in Q3 year-on-year (Y-o-Y). 

 

Around 11:07 AM, Kirloskar Oil share price was down 1.66 per cent at Rs 768.65 per share on BSE. In comparison, the BSE Sensex was down 0.80 per cent at 75,686.32. The market capitalisation of the company stood at Rs 11,155.86 crore. The 52-week high of the stock was at Rs 1,450 per share.

Kirloskar Oil Engines Q3 results 

The company posted a 21 per cent decline in net profit year-on-year (Y-o-Y) to Rs 71.3 crore as compared to Rs 89.82 crore. Its revenue for the quarter under review rose 4.5 per cent to Rs 1,453.7 crore as compared to Rs 1,391.3 crore a year ago. 

 

 

The company's standalone Earnings before interest, tax, depreciation, and amortisation (Ebitda) reduced by 9 per cent Y-o-Y to Rs 117 crore as compared to Rs 128 crore a year ago.Ebitda margin stood at 10.1 per cent as against 11.3 per cent a year ago. 

 

"This quarter was a subdued quarter for Kirloskar Oil Engines with multiple headwinds. On the business-to-business (B2B) side, as expected, we faced muted demand in our Powergen business post the emission norms transition," said Gauri Kirloskar, managing director, Kirloskar Oil Engines.

 

She added: On the business-to-consumer (B2C) side, we have successfully completed the consolidation of five plants into 1, which saw some impact on production. We will stay watchful of the trends developing in the power generation market and expect that demand will return to earlier levels in the next couple of quarters.

 

Kirloskar Oil Engines is a leader in the manufacturing of internal combustion engines, farm equipment,t, and generator sets with a sizable presence in international markets. It also manufactures world-class engines for construction equipment. It specialises in manufacturing air-cooled and liquid-cooled engines for generator sets across a wide range of power outputs (2kVA to 3000 kVA).

 

In the past one year, Kirloskar Oil shares have lost 4 per cent against Sensex's rise of 7.3 per cent.