Company Update : Kirloskar Oil Engine Ltd By Motilal Oswal Financial Services Ltd
Highest ever revenue in a quarter
* KOEL reported a good set of results, beating on all parameters.
* Revenue stood at INR14.1b, which was the highest ever sales in a quarter, growing 2% YoY even on a high base of INR13.9b in 4QFY24. The B2B segment was broadly flat YoY, while B2C revenue rose 15% YoY.
* EBITDA at INR1.7b was above our estimates of INR1.6b (11% beat), albeit down 2% YoY. Accordingly, EBITDA margin came in at 12.3%, a contraction of ~50bp YoY. B2C segment profitability has started improving, which can be seen as margins for the segment have more than doubled YoY in 4QFY25 to 11.0% vs. 5.2% last year in the same quarter.
* PAT increased 8% YoY to INR1.1b, even with an adjustment for an exceptional gain on the sale of aircraft amounting to INR209m, and a lower-than-expected tax rate (25.6% actual vs. 26.7% expected).
* For FY25, despite the demand correction post the pre-buy and the CPCB4+ transition, revenue/EBITDA/PAT grew 5%/16%/14% YoY, while EBITDA margin/PAT margin expanded 120bp/60bp YoY.
* OCF/FCF increased YoY by 13%/71%, reaching INR4.9b/2.7b in 4QFY25 vs INR4.3b/1.6b in 4QFY24.
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