Kirloskar Oil Engines Reports 34% Drop in Quarterly Net Profit to ₹134.90 Crores

Kirloskar Oil Engines Limited (KOEL), a leader in the manufacturing of internal combustion engines and generator sets, has reported a decline in its financial performance for the quarter ended September 30, 2025. The company's net profit fell by 34% year-on-year to ₹134.90 crores, while revenue from operations decreased to ₹1,244.65 crores.

Financial Highlights

Metric	Q2 FY26	Q2 FY25	YoY Change
Revenue from Operations	1244.65	1306.01	-4.70%
Net Profit	134.90	204.20	-34.00%

For the half-year period, net profit decreased to ₹258.73 crores from ₹352.53 crores in the previous year.

Key Developments

The company's Board approved the transfer of its Business to Customer (B2C) segment, including Water Management Solutions domestic and export business, to its wholly owned subsidiary La-Gajjar Machineries Private Limited through a slump sale.
KOEL invested $2 million (approximately ₹17.76 crores) in Series A-1 Preferred Stock of its US subsidiary Kirloskar Americas Corporation.
Total assets stood at ₹4,747.19 crores as of September 30, 2025, compared to ₹4,307.50 crores in the previous year.

Financial Position

Despite the decline in quarterly performance, Kirloskar Oil Engines maintains a strong financial position. The increase in total assets indicates ongoing investments.

Strategic Moves

The restructuring of B2C operations through the transfer to La-Gajjar Machineries Private Limited may be part of KOEL's efforts to streamline operations. The investment in Kirloskar Americas Corporation suggests a continued focus on international presence.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
+2.48%	+9.75%	+22.68%	+50.95%	-1.06%	+979.50%

Kirloskar Oil Engines Limited (KOEL) has recently expanded its share capital through the allotment of equity shares under its Employee Stock Option Plan (ESOP). This move, approved by the company's Stakeholders Relationship Committee, marks a notable development in KOEL's capital structure and employee incentive program.

Key Details of the Allotment

The Stakeholders Relationship Committee, in a meeting held on November 11, approved the allotment of 36,279 fully paid-up equity shares, each with a face value of Rs. 2. This allotment was made as part of the 'Kirloskar Oil Engines Limited – Employee Stock Option Plan 2019' (KOEL ESOP 2019).

Impact on Share Capital

The allotment has resulted in changes to KOEL's share capital structure:

Category	Before Allotment	After Allotment
Issued and Subscribed Capital	Rs. 29,05,91,200	Rs. 29,06,63,758
Paid-up Capital	Rs. 29,05,90,270	Rs. 29,06,62,828
Total Equity Shares (Issued and Subscribed)	14,52,95,600	14,53,31,879
Total Equity Shares (Paid-up)	14,52,95,135	14,53,31,414

Significance of the ESOP Allotment

The allotment of shares under the ESOP serves multiple purposes:

Employee Incentivization: It aligns employee interests with those of the company and its shareholders.
Talent Retention: ESOPs can be an effective tool for retaining valuable employees.
Capital Structure Enhancement: The slight increase in share capital contributes to the company's overall financial structure.

Regulatory Compliance

Kirloskar Oil Engines has duly informed the stock exchanges about this development, in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company's proactive disclosure underscores its commitment to transparency and regulatory adherence.

Conclusion

This equity share allotment under the ESOP represents a strategic move by Kirloskar Oil Engines Limited to strengthen its employee engagement while simultaneously adjusting its capital structure. Such initiatives may play a role in the company's growth strategy and market position.