1. At a Glance
Q1 FY26 for Kirloskar Pneumatic wasn’t exactly a “pressure-packed” blowout. Revenue was flat at ₹272 Cr, profit dipped slightly to ₹28 Cr, and the stock tanked 11% in a single session. But don’t touch that panic button yet—order book remains strong, and the margins are quietly holding the fort.
2. Introduction with Hook
Imagine a Formula 1 car that suddenly brakes, not because it’s faulty—but because the track’s about to twist into a better lap. That’s Kirloskar Pneumatic right now.
- Q1 Revenue: ₹272 Cr (YoY flat)
- Q1 PAT: ₹28 Cr (vs ₹27 Cr last year)
- Stock crashed 11% post-results… but is that fear justified?
With a ₹1,725 Cr order book and zero debt, KPCL may just be cooling the cylinders before the next acceleration.
3. Business Model (WTF Do They Even Do?)
Kirloskar Pneumatic makes the machines that make machines work.
- Compression Segment (CNG + Industrial Compressors): 70%+ market share in CNG stations, ammonia refrigeration
- Transmission Segment: Gearboxes, railway traction systems
- Services & Logistics: O&M, “RoadRailer” transport services
It caters to Oil & Gas, Railways, Cement, Steel, and Food—basically every sweaty, heavy-lifting Indian industry.
4. Financials Overview
Q1 FY26 Snapshot (₹ Cr):
| Metric | Q1 FY26 | YoY Change |
|---|---|---|
| Revenue | 272 | Flat |
| EBITDA | 36 | +38% |
| EBITDA Margin | 13.2% | Slight drop |
| PAT | 28.1 | +4.4% |
| EPS | ₹4.33 | Flatish |
TTM Sales: ₹1,625 Cr
TTM PAT: ₹212 Cr
Market Cap: ₹8,557 Cr
5. Valuation
| Metric | Value |
|---|---|
| CMP | ₹1,316 |
| P/E | 39.8x |
| P/B | 7.82x |
| EPS (TTM) | ₹32.72 |
| Book Value | ₹169 |
Fair Value Range
| Method | Value Range (₹) |
|---|---|
| DCF (Base Case) | ₹950–1,200 |
| Peer P/E Median (30–35x) | ₹980–1,145 |
| Bull Case (Order Book Kick) | ₹1,400–1,500 |
Comment: At nearly 40x earnings, it’s no longer cheap. But if FY26 sees execution on that ₹1,700+ Cr order book? This gets spicy again.
6. What’s Cooking – News, Triggers, Drama
- Q1 Results Miss: Street expected ~₹300 Cr revenue, got ₹272 Cr
- Order Book: ₹1,725 Cr = 12 months+ visibility
- New Compressor Launched: Strategic product expansion
- Director Resignation: Deepak Bagla joins Govt of India—market overreacted?
- FIIs Booking Out: Holding dropped from 7.73% to 7.12% this quarter
7. Balance Sheet
FY25 Summary (₹ Cr):
| Item | Value |
|---|---|
| Equity Capital | ₹13 |
| Reserves | ₹1,083 |
| Total Borrowings | ₹1 |
| Other Liabilities | ₹517 |
| Fixed Assets + CWIP | ₹312 |
| Investments | ₹460 |
| Net Cash Position | Strong AF |
Note: Essentially debt-free with ₹215 Cr in CFO last year. Asset-light, order-heavy.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Flow |
|---|---|---|---|---|
| FY23 | ₹40 | ₹–11 | ₹–28 | ₹0 |
| FY24 | ₹183 | ₹–136 | ₹–33 | ₹14 |
| FY25 | ₹215 | ₹–155 | ₹–45 | ₹14 |
Interpretation: They’re using OCF for capex—healthy reinvestment cycle, no leverage dependence.
9. Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROCE | 28.3% |
| ROE | 21.1% |
| OPM | 18% |
| Debtor Days | 107 |
| Inventory Days | 85 |
| Payable Days | 89 |
| Cash Conv. Cycle | 103 Days |
Verdict: Still efficient, but cash cycle has stretched a bit—working capital pressure?
10. P&L Breakdown – Show Me the Money
| FY | Revenue | EBITDA | PAT | EPS |
|---|---|---|---|---|
| FY23 | ₹1,239 | ₹168 | ₹109 | ₹16.8 |
| FY24 | ₹1,323 | ₹205 | ₹133 | ₹20.6 |
| FY25 | ₹1,629 | ₹294 | ₹211 | ₹32.5 |
Mic Drop: 3-year PAT CAGR = 38%
Margins have ballooned from 13% → 18%
This ain’t the old school Kirloskar anymore.
11. Peer Comparison
| Company | P/E | OPM % | ROCE % | ROE % | CMP/BV |
|---|---|---|---|---|---|
| Kirloskar Pneumatic | 39.8 | 18% | 28.3% | 21.1% | 7.82 |
| Cummins India | 49.8 | 20% | 36.3% | 28.2% | 13.1 |
| Elgi Equipments | 50.3 | 15% | 21.9% | 20.1% | 9.3 |
| Shakti Pumps | 27.6 | 24% | 55.3% | 42.6% | 9.5 |
Observation: KPCL isn’t the fastest or cheapest—but it’s predictable and poised.
12. Miscellaneous – Shareholding, Promoters
| Category | Q1 FY26 (%) |
|---|---|
| Promoters | 38.84% |
| FIIs | 7.12% |
| DIIs | 28.2% |
| Public | 25.8% |
| Shareholders | 65,393 |
Trend: Promoters slowly reducing stake (–14.8% over 3 years), but DIIs and retail stepping in.
13. EduInvesting Verdict™
Kirloskar Pneumatic just reminded the market that even strong stories can catch a cold. But the fundamentals? Still minty fresh:
- Clean balance sheet ✅
- Strong margins ✅
- Big order book ✅
- Promoter selling? Hmm.
- Valuation? Stretched but tolerable for a niche leader.
Final Word: This quarter may have lacked gas, but the long-term cylinders are still firing.
Metadata
– Written by EduInvesting Team | 22 July 2025
– Tags: Kirloskar Pneumatic, Q1 FY26, Compressors, Industrial Growth, Capital Goods, Order Book, CNG Systems
