Latest News | Kirloskar Oil Engines Says Sales Almost Back to Pre-pandemic Level
Get latest articles and stories on Latest News at LatestLY. The world's largest manufacturer of gensets Kirloskar Oil Engines, which last week launched an industry-first kitchen/municipal waste composter, expects revenue to reach or even cross the pre-pandemic levels by March.
Mumbai, Oct 4 (PTI) The world's largest manufacturer of gensets Kirloskar Oil Engines, which last week launched an industry-first kitchen/municipal waste composter, expects revenue to reach or even cross the pre-pandemic levels by March.
The Pune-based company, which also is the world's second largest maker of railway power cars, has also announced a 4-5 per cent price hike effective this month to offset the input cost, which should help increase the margins.
Justifying the price hike, Sanjeev Nimkar, managing director and chief executive of Kirloskar Oil Engines, told PTI on Monday that there was a massive increase in input cost in recent months, and he cannot but partially pass on the cost to consumers to protect margins which has fallen to low single digit in the Q1. "Normally our margins are in double-digit and averages 10 per cent".
The company leads the low and medium capacity gensets market annually selling around 30,000 units, fetching around 40 per cent of the topline, followed industrial engine contributing 20 per cent, water management 17-18 per cent and electric motor-based pumps another 18 per cent. It is the second largest player in the high margin heavy engines segment annually grossing over 3,000 units.
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On sales outlook, Nimkar said, "we are already almost at the pre-pandemic levels now. And of the rising demand seen in our farm gensets, industrial engines which yield high margins, continue... we will close the year on par with FY20 levels or even a tad better. Even during the lockdown months, agri and water pumps were doing very well. In fact Q2 was very good and much better.
On capacity utilisation, he said it is averages at 65 per cent of the 1.2 lakh units installed capacity.
Exports, which contribute only 8-9 per cent of income now, are targeted to go up to 15 per cent over the next 4-5 years, he said.
As part of its sustainability measures, the company over the weekend launched a Kirloskar i-Land, a fully automated organic waste composter that converts organic waste from homes and commercial spaces into compost, with a view to help reduce waste dumping in landfills and also reduce the waste-treatment pressure on government agencies, Nimkar said, adding this is the only organic composter validated by the premier national scientific body CSIR or the Council of Scientific and Industrial Research Institute.
The machine, which is now run on electricity and the next batch on solar power, has three chambers with the third one having live micro-organisms, and will cost Re 1 per person per day.
A 25 kg composter machine, ideal for large housing societies with 50 flats, is priced at around Rs 2.5 lakh, while industrial ones are 1,250 kg machines ideal for hotels and other large establishments, priced at around Rs 25 lakh each.
Nimkar said within the first week of the launch, the company sold 5 units and got bookings for 300 units and he has set a target of selling 1,000 units in the first year.
Citing government data, he said 65 million tonne waste is generated annually in the country of which 62 million are municipal solid waste which include organic waste, recyclables like paper, plastic, wood, glass, etc. Only about 75-80 per cent of this gets collected and of this only around 25 per cent treated and the rest makes its way to dump yards.
According to the World Resources Institute India data, Mumbai alone produces at least 6,800 tonnes of solid waste every day which is dumped into landfills and account for 7 per cent of the city's greenhouse gas emissions.
In the June quarter, the company reported standalone net sales of Rs 639.2 crore, up from Rs 314.8 crore a year ago and earned a net income of Rs 24.5 crore, as against net loss of Rs 10.8 crore in the same period of the previous fiscal and a margin of 7.6 per cent as against a negative margin of 1.4 per cent in the same period previous fiscal.
It runs four facilities in Pune, Nashik and Kolhapur and employs over 3,100.
(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)