Kirloskar Electric Co has released its unaudited financial results for the first quarter, revealing a slight dip in revenue but maintaining profitability. The company's board has also made key decisions regarding directorship and cost auditors.

Financial Performance

For the quarter ended June 30, Kirloskar Electric reported:

The company's revenue saw a marginal decrease of 0.92% compared to the same quarter last year. However, net profit after tax experienced a more significant decline of 69.60%.

Segment-wise Performance

Kirloskar Electric operates in three segments:

1. Power Generation/Distribution: Generated revenue of ₹7,207.00 lakhs
2. Rotating Machines: Contributed ₹5,944.00 lakhs to the revenue
3. Others: Accounted for ₹169.00 lakhs in revenue

Board Decisions

The Board of Directors, in their meeting held on August 12, approved several key matters:

1. Director Continuation: The board approved the continuation of Mr. Ravi Ghai (DIN: 08715119) as an Independent Director beyond the age of 75 years. Mr. Ghai will turn 75 in February 2026. This decision is subject to shareholder approval at the upcoming Annual General Meeting.

2. Cost Auditors Appointment: Based on the Audit Committee's recommendation, the board appointed M/s. Rao, Murthy & Associates, Cost Accountants, Bengaluru (FRN: 000065) as Cost Auditors for the financial year ending March 31, 2026.

Ongoing Developments

Merger of Subsidiaries

The company has filed an application with the National Company Law Tribunal (NCLT) for the merger of its wholly-owned subsidiaries:

• Kelbuzz Trading Private Limited
• SKG Terra Promenade Private Limited
• SLPKG Estate Holdings Private Limited
• Luxquisite Parkland Private Limited

The next hearing is scheduled for September 18, 2025.

Asset Monetization

Kirloskar Electric is in the process of monetizing its immovable property in Hubballi. The company has entered into agreements to sell portions of this property, which is expected to improve working capital and overall performance in the coming periods.

Auditor's Review

The statutory auditors have conducted a limited review of the financial results. They have highlighted the company's accumulated losses and eroded net worth but noted the management's restructuring plans and potential for improvement through asset monetization and increased turnover.

Kirloskar Electric continues to navigate challenging market conditions while focusing on strategic decisions to strengthen its financial position and operational efficiency.

Kirloskar Electric Co Limited (KECL) has received approval from the National Company Law Tribunal (NCLT) Bengaluru Bench for the merger of its four wholly-owned subsidiaries. This strategic move is set to streamline the company's operations and potentially enhance its market position.

Merger Details

The NCLT has given the green light for KECL to absorb four of its wholly-owned subsidiaries:

1. KELBUZZ Trading Private Limited
2. Luxquisite Parkland Private Limited
3. SLPKG Estate Holdings Private Limited
4. SKG Terra Promenade Private Limited

The merger is slated to take effect from April 1, 2024, as per the Scheme of Merger approved by the tribunal.

Regulatory Compliance

As part of the merger process, KECL is required to fulfill several regulatory obligations:

• Notifications: The company must issue notices to specified authorities, including:

  • Ministry of Corporate Affairs
  • Income Tax Authorities
  • Other relevant regulatory bodies

• Representation Period: These authorities have been given 30 days from the receipt of the notice to submit their representations, if any.

• Public Announcement: KECL has been directed to publish notices in two prominent newspapers:

  • Business Standard (English edition)
  • Vishwavani (Kannada edition)

Next Steps

The case is scheduled for a follow-up hearing on September 18, 2025. This hearing will likely review the representations received from the notified authorities and assess the company's compliance with the merger requirements.

Implications

This merger is a significant corporate action for Kirloskar Electric Company Limited. By consolidating its wholly-owned subsidiaries, KECL may be aiming to:

• Simplify its corporate structure
• Reduce administrative overheads
• Improve operational efficiency
• Potentially realize cost savings

Investors and stakeholders will be keenly watching how this merger impacts KECL's financial performance and market position in the coming years.

As the merger process unfolds, Kirloskar Electric Company Limited will need to ensure strict adherence to all regulatory requirements and maintain transparent communication with its shareholders and the market at large.