1. At a Glance
Kirloskar Industries Ltd (KIL) – the 133-year-old industrial aristocrat of Pune – just dropped its Q2FY26 results, and it’s doing what it does best: collecting dividends from its own family. The consolidated revenue stood at ₹1,782 crore, a 5.6% YoY rise, while net profit came in at ₹98 crore, up 1.2% YoY. The company is trading around ₹3,607, with a market cap of ₹3,790 crore. Its P/E ratio is 23.7, and despite owning more land than some states, the ROE is a modest 2.6%, which is basically “real estate returns if you rented to your cousin at half rent.”
With an EV/EBITDA of 5.55x, KIL looks cheap on paper but is mostly a holding company whose real muscle is its 51% stake in Kirloskar Ferrous Industries (KFIL)—the subsidiary that does all the heavy lifting while KIL collects rent and dividends like an old Maharaja sipping Darjeeling.
Want to know how a company can be in iron castings, real estate, and windmills all at once – and still attend SEBI hearings for insider trading? Buckle up.
2. Introduction
Kirloskar Industries is what happens when your great-grandfather built an empire, your grandfather expanded it, and your generation… just manages it. Born in 1888 and incorporated as a company decades later, KIL is part of the larger Kirloskar family dynasty—known for engineering, pumps, and family feuds that could fuel ten seasons of Succession: Pune Edition.
Today, the company’s job description reads like a random LinkedIn bio:
- Manufactures iron castings through KFIL,
- Generates wind power,
- Rents out prime real estate in Pune, Delhi, and Jaipur,
- Invests in group companies,
- And occasionally deals with SEBI fines.
Despite its diversified presence, over 90% of consolidated revenue flows from its ferrous subsidiary KFIL, while standalone KIL itself lives on dividend income and rental receipts—the corporate equivalent of living off your parent’s fixed deposits.
The stock trades at just 0.55x its book value, which sounds like a steal until you realize that most of that “book value” is tied up in properties leased to its own cousins. The company has debt of ₹1,296 crore, a current ratio of 1.91, and zero pledges—probably because even SEBI knows this family’s equity is sacred ground.
3. Business Model – WTF Do They Even Do?
Trying to explain Kirloskar Industries’ business model is like trying to explain why your uncle has three companies but one GST number. Here’s the breakdown:
1. Iron Castings (92% of revenue):
Through Kirloskar Ferrous Industries Ltd (KFIL) – its 51% owned powerhouse – the group manufactures pig iron, cylinder heads, blocks, and other castings. It’s one of India’s top three pig iron producers. KFIL also acquired Indian Seamless Metal Tubes (ISMT) in FY22, diversifying into seamless tubes—because nothing says “expansion” like buying another metal company when you already have one.
2. Wind Power Generation:
The company operates windmills because, apparently, owning land wasn’t passive enough income.
3. Real Estate (Avante Spaces Ltd):
Under its wholly-owned subsidiary Avante Spaces (earlier
Wellness Space Developers), KIL develops and licenses property. It once sold its Kothrud real estate business for ₹75 crore through a slump sale and then—plot twist—renamed the buyer as its own subsidiary. That’s not a transaction; that’s corporate yoga.
4. Investments:
The company holds ₹1,185 crore worth of investments across the Kirloskar family ecosystem—Pneumatic, Brothers, Oil Engines, and even the odd unrelated company for “diversification.”
Essentially, Kirloskar Industries is a mini family office wrapped in an industrial shell. Its subsidiaries make the money, it collects the rent, and SEBI collects the fines.
4. Financials Overview
| Metric | Latest Qtr (Sep 2025) | Same Qtr Last Yr | Prev Qtr (Jun 2025) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | ₹1,782 Cr | ₹1,688 Cr | ₹1,705 Cr | 5.6% | 4.5% |
| EBITDA | ₹233 Cr | ₹212 Cr | ₹219 Cr | 9.9% | 6.4% |
| PAT | ₹98 Cr | ₹92 Cr | ₹95 Cr | 6.5% | 3.1% |
| EPS (₹) | 49.2 | 47.8 | 42.1 | 3.0% | 16.7% |
Commentary: The growth looks modest but steady—like your father’s fixed deposit renewal slip. With EBITDA margin at around 13%, the company’s operating efficiency has stabilized post its ISMT integration. PAT margins are thin for a company that technically controls a steel empire and half of Pune’s real estate.
5. Valuation Discussion – Fair Value Range
Let’s decode KIL’s valuation like an auditor who’s been served black coffee and a SEBI notice.
Method 1: P/E Approach
EPS (FY25 consolidated) = ₹159
Industry P/E = 28.7
Company P/E = 23.7
→ Fair range = ₹159 × (20–28.7) = ₹3,180 – ₹4,560
Method 2: EV/EBITDA Approach
EV = ₹4,930 Cr; EBITDA (FY25) = ₹830 Cr
EV/EBITDA = 5.9x
Industry average ~7.5x
→ Fair EV range = ₹830 × (5–7.5) = ₹4,150 – ₹6,225 Cr
→ Adjusted equity range = ₹3,500 – ₹5,250 per share
Method 3: DCF Snapshot
Assuming 5% long-term growth and 10% discount rate, free cash flow of ₹598 Cr (FY25),
→ Implied range = ₹3,400 – ₹4,600 per share
🎯 Fair Value Range (Educational Purpose Only)
₹3,200 – ₹4,600 per share
Disclaimer: This is for educational discussion, not investment advice. If you buy or sell, you’re on your own like SEBI’s legal counsel in Bombay HC.
6. What’s Cooking – News, Triggers, Drama
Oh, there’s plenty cooking – and it’s not just
