Kirloskar Brothers Ltd. Financial Analysts Meet Quarter 3 ... Meet/100241_20110120.pdfMarket survey...

1This is a proprietary document of Kirloskar Brothers Ltd.

Kirloskar Brothers Ltd.

Financial Analysts Meet

Quarter 3

FY 2010-11

20th

January, 2011

This is a proprietary document of Kirloskar Brothers Ltd.

Companywide

Highlights

2

• Focus on being very selective in taking project and product orders

with better terms

• Priority for manufacturing and execution where payment terms are

better

• Projects are controlled more locally and monitored by controller

and chief controller

• Maximize electromechanical projects

Companywide

Other Highlights

• UP 1200/160 largest size split case pump successfully developed for Pipavav

Power station.

• Successfully demonstrated water mist technology at simulation chamber in

CFEES order received for Rs.78 million to design and simulate water mist

system for submarine at Vishakhapatnam.

• Low cost oil header developed and tested at shop for Kaplan turbine runner

blade operation.

• 3,600mm butterfly valve successfully developed after value engineering

• All manufacturing locations covered under QMS 2008 and OHSAS


Sector Highlights

Irrigation

Benban & Roziakat Projects - Crossed 50% POC milestone in Dec-2010 and project is

progressing as per client's schedule

Godavari Project - Completed PG testing at 3 sites successfully, for intake it is being

completed during Jan-11

Water Resource Management

KWA Meenad Project: 73 MLD total water supply scheme which includes intake works ,

rising main pipeline, water treatment plant and clear water pumping station commissioned –

value Rs. 760 million


Sector Highlights

Water Resource Management (Contd...)

Order for BFV : Rs 53 million order for large size BFV, size involved 2,500 mm & 2,700 mm

from SPML a/c BWSSB

Power

Market survey for pumps in power sector by BDB is completed and report submitted for

review.

Training session on pumping technology held at Calik Enerji, Turkey on 18th October

2010.

Meeting held with Adani Power, Siemens for Sugen, Doosan for Raikheda and Indiabulls

for Amravati and Nashik projects.


Sector Highlights

Power (Contd..)

NTPC Senior level team visited KBL Pune office on 23rd Oct'10 to review of progress of

various projects being executed.

Finalization of ANI for N stamp approval proposal made for approval. Formation of task

force at factory to implement N stamp approval process.

Received order for 8 sets of CE pumps from RKS Powergen for 4x320 MW Chhattisgarh

Power Plant.

All six sets CE pumps are modified and running successfully at Siemens Sugen.

Meeting held with Siemens Germany team and MOM singed.

Presentation to Mott Macdonald for CVP for 1040 MW Vizag Plant of Hinduja Power.


Sector Highlights

Power (Contd..)

Doosan senior team visited to KOV for CV pump package for 2x685 MW GMR Raipur

projects.

Participated in Annual Nuclear Conference ANUP 2010 held at Kalpakkam on 10th

October 2010.

Presentation to L&T on CV Pump for VISA Power & DB Power project.

Meeting held with TOP management of leading Russian Nuclear project company based

on Light Water Reactor (LWR) Technology.

Oil & Gas

Pre Tendering activities with 'Gactel' resulted in order worth Rs. 18.6 million.

Received order from HPCL for Kadappa Project for 24 Nos.KPD & KPDS Pump with

Motor, ARC Valve & Spares, Value Rs. 12.53 million.


Sector Highlights

Oil & Gas (Contd..)

Engineering activity for SHG offshore platform for ONGC completed. Stage payment

being claimed.

Marine & Defence

Completed negotiation for first order of water mist on Nuclear Submarine for the value of

Rs 78 million from DRDO/Indian Navy.

Received order of Rs. 34 million from ITD Cementation for GRSE modernization dry dock

drainage project. The project was awarded to us on premium keeping our current

association in mind.


Sector Highlights

Marine & Defence (Contd..)

Received order of Rs 16.5 M from Alcock Ashdown Gujarat for 06 Indian Naval survey

vessels. Scope involves supply of 10 number 3.7 kW NS pumps in special metallurgy per

ship.

KOV plant approval by IRS completed.


Sector Highlights

Distribution:

• Industry segment crossed AOP with 105% achievement and 33% growth over last year.

• Submersibles growth of 47% on value over last year achieved by selling 8,419 units this YTM.

New models suitable to South Zone being developed and launched.

CSS

• Most Prestigious high Value order( 17M) of IOCL- Panipat & Rs 18M from NTPC-Sipat are

received.

Industry

• Second export order from JGC, Japan worth Rs.5.0 million through KBTL indicating a sign of

confidence because of the smooth progress of the first order under execution.


Sector Highlights

Building & Construction

• For the first time multi outlet multi stage RKB pumps in vertical execution order taken from Pune

region for Paranjape Builders for Blue Ridge project. Order accepted with 50% advance.

• Biggest ever HVAC order from Mumbai international Airport of value Rs 10.2 million.

• FM/UL order for prestigious BARC project at Tarapur – the first order in India for any of BARC

installation.


Kirloskarvadi Factory

Highlights

• Shop layout correction in the small pumps division completed which will improve

productivity

• Steel foundry capacity expansion from 50T to 100T is completed, few equipments are

under commissioning - this would help the industry sector sales

• The main impediment of Dies availability for Replicast has been resolved, orders with

Taiwan vendor being finalized

• Casting method simulation software MEGMA Software commissioned with additional work

station for TKSL. Castings yield and RT Level of castings would improve significantly


Dewas Factory

Highlights

• MOST study carried out and agreement of 460 minutes will be signed in next 15-days

• New layout for Single Phase & KOS with productivity improvement of upto 80%

• The total capacity once the initiatives stabilizes will be 47,000 pumps from current 24,000

pumps in 3-months, including higher capacities for Industrial pumps like SP & 3-Phase.

• Supplier quality improvement program through “Millap” project & in-house quality through

“Pratibimbh” project.

• Project “Blackgold”, Foundry targets of 320 tons in next 3-months with target cost of 75/- for

Impeller & 50/- for other components


Dewas Factory

We Are Changing…

Dewas Factory New Assembly Lines –

Single Phase & KOS


Paint Booth

Return Lifter

15

Main Assembly Line

Dewas Factory - New Assembly Line-

Single Phase

Dewas Factory

We Are Changing…


Motor Body Sub Assembly

Packaging Set-up

16

Dewas - New Assembly Line- Single Phase

Dewas Factory

We Are Changing…


07.01.11

Coimbatore & Ahmedabad Factory

Highlights

• The Coimbatore plant for Mini pumps will be commissioned by March 2011, with trial

production beginning by April 2011

• The Ahmedabad plant for Sumbersible pumps will be commissioned by May 2011 with

trial production by June / July 2011

• The motor capacity will be 6000, which includes more than 2000 motors from Hematic,

Karad

• All major products from Dewas will be star products. More than 100 models already 5-Star

labeled and another 60+ under process.


07.01.11

Coimbatore Factory construction update

Coimbatore Factory

Update…


Kondhapuri Factory

Highlights

• Developed 1500 mm SLV in rising & non-rising versions & completed order for DJB & UP

Jal Nigam

• Developed 3600 mm BFV with internal ebonite lining for sea water application for Essar

Salaya Thermal Power Plant

• Successfully completed POD testing of 1600 mm BFV with integral ebonite lining

• Developed 800 mm MDNRV with internal ebonite lining for CGPL Mundra Project (PWR)

• Obtained patent for Tamper Proof KAV series

• Booked single largest order of 82.5M for RKM PowerGen for 28 Nos. 2000 mm BFV



Companywide

Pending Orders

20

Sector 3Q % 2Q

(Rs.million) Dec 10 Sept 10

Irrigation (IRR) 17,021 50.6% 17,810

Water Resource Management (WRM) 4,456 13.3% 4,574

Power (POW) 9,717 28.9% 9,448

Oil & Gas (O&G) 986 2.9% 1,089

Marine & Defence (M&D) 145 0.4% 87

Industry (IND) 542 1.6% 597

Building & Construction (B&C) 253 0.8% 238

Distribution (DIS) 195 0.6% 159

Customer Service & Support (CSS) 310 0.9% 377

TOTAL 33,624 100.0% 34,378


Companywide

Major Orders

Total orders received by KBL during 3Q FY 10-11 amounted to Rs. 1,959 million

21

Sector Order Type Customer Value

(Rs.mil)

Irrigation Conversion of Deisel Engine driven pumpsets to

Electrical Driven Pumpsets

Ministry of Agriculture & Forestry,Laos 193.6

Water Resource Management Supply of E &M equipments KUWS&DB Dharwad WSS 74.5

Power Raw Water Package for Amravati TPP India Bulls Limited 190.0

Oil & Gas 20UPH3M1 DV Gactel 18.6

Marine & Defence Dock Drainage Modernization system ITD Cementation 34.0

Industry Assorted Pumpsets Hindalco 16.5

Building & Construction Assorted Pumpsets ABB Ltd. 12.0

Distribution Assorted Pumpsets KSK Scheme 6.5

Customer Support & Service Supply of Spares NTPC 18.0


Sales :

• Total sales are at Rs. 1,221Crs as against Rs. 1,387 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 of Rs. 304 Crs is mainly due to holding back of

dispatches for projects in Andhra Pradesh in H1. Current dispatches to AP

are being made 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. Dispatches have now started

• 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 54% as

against 45% in the previous year.

Q3 FINANCIALS

Standalone Highlights


• We had planned execution of balance portion of Senegal Export order

(Rs.12 Crs) in Quarter 3, however this is happening in Q4 only

• We made efforts to cross the POC threshold for 4 projects in Q3, but only

2 crossed the same.

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

50% from the erstwhile 35%

Q3 FINANCIALS



PBT :

• PBT has come down to Rs. 60 Crs ( 5% of Total Income ) as compared to

Rs. 89 Crs ( 6.1% 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%

• The execution of the balance portion of Madanpalli supply contract to AP

& Laos export order will take place in Q4

• We are also closely tracking the status of 5 major projects for crossing

POC level in Q4

Q3 FINANCIALS



Q3 FINANCIALS


The major focus for Q4 :

• Regulate sales to ensure that only those sales where money

would be immediately recovered are made

• Collect Receivables as planned

• Inventory reduction as planned

• Reduction in borrowings

This will result in a drop in sales and profits in absolute numbers

compared to PY, but will result in a cleaner and better Balance Sheet

compared to December 2010.


Q3 KEY FINANCIALS –

Standalone

( Rs in Crores )

Particulars

Dec-10 Dec-09 Dec-08

KEY FINANCIALS

Total Income 1,231 1,407 1,211 2,066

P B D I T 105 134 60 233

P B T 60 89 25 173

P A T 41 59 20 118

CASH PROFIT 63 78 35 144

KEY FINANCIAL RATIOS

P B I D T % AGE 8.6% 9.5% 5.0% 11.3%

P B T % AGE 4.9% 6.3% 2.1% 8.4%

R O C E % AGE 9.4% 15.4% 5.7% 19.2%

Period Ending Year

Ended Mar

31, 2010


Q3 KEY FINANCIALS -Consolidated

( Rs in Crores )

Particulars

Dec-10 Dec-09 Dec-08

KEY FINANCIALS

Total Income 1,791 1,862 1,635 2,680

P B D I T 151 172 95 275

P B T 90 108 47 191

P A T 57 67 31 113

CASH PROFIT 90 95 53 152

KEY FINANCIAL RATIOS

P B I D T % AGE 8.4% 9.2% 5.8% 10.3%

P B T % AGE 5.0% 5.8% 2.8% 7.1%

R O C E % AGE 10.6% 14.6% 6.9% 18.9%

Period Ending Year Ended

Mar 31,

2010


THANK YOU

Kirloskar Brothers Ltd. Financial Analysts Meet Quarter 3 ... Meet/100241_20110120.pdfMarket survey...

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