KOEL Q2 profit attributable to owners falls as revenue rises

Kirloskar Oil Engines Limited (KOEL) reported Rs 2,284.04 crore of consolidated revenue in the quarter ended September 30, 2026, up 17% year on year, while profit attributable to owners fell 30% to Rs 113.71 crore from Rs 161.96 crore. Continuing-operations profit before tax declined 19% to Rs 175.47 crore.

What did KOEL report for Q2 2026?

KOEL reported higher quarterly revenue but lower profit in the quarter ended September 30, 2026. Revenue from operations rose by Rs 333.41 crore to Rs 2,284.04 crore from Rs 1,950.63 crore in the quarter ended September 30, 2025, while total income increased to Rs 2,294.17 crore from Rs 1,962.86 crore. Other income, however, declined to Rs 10.13 crore from Rs 12.23 crore.

Profit before tax from continuing operations fell by Rs 40.83 crore to Rs 175.47 crore, while net profit from continuing operations decreased by Rs 28.88 crore to Rs 130.31 crore. Profit attributable to KOEL owners was Rs 113.71 crore, compared with Rs 161.96 crore a year earlier. Basic earnings per share for continuing and discontinued operations fell to Rs 7.82 from Rs 11.17.

How did KOEL's segments change in Q2 2026?

KOEL's business-to-business, or B2B, segment supplied most of the revenue growth, with quarterly revenue rising to Rs 1,715.28 crore from Rs 1,456.64 crore. The Rs 258.64 crore increase accounted for most of the group’s Rs 333.41 crore rise in revenue from operations. The B2B segment includes engines, generator sets, electric motors, spare parts and oils.

Business-to-customer, or B2C, revenue increased to Rs 330.18 crore from Rs 258.41 crore, adding Rs 71.77 crore year on year. KOEL defines this segment as diesel- or electric-operated pumps, pump sets, accessories and allied products. Financial-services revenue moved in the opposite direction, declining by Rs 27.00 crore to Rs 208.58 crore from Rs 235.58 crore.

For the half year ended September 30, 2026, B2B revenue was Rs 3,213.56 crore compared with Rs 2,732.96 crore a year earlier. B2C revenue increased to Rs 631.18 crore from Rs 550.20 crore, whereas financial-services revenue declined to Rs 419.01 crore from Rs 430.56 crore. Group revenue from operations for the half year rose to Rs 4,263.75 crore from Rs 3,713.72 crore.

Why did KOEL's profit decline despite revenue growth?

KOEL's reported segment results show lower profit contributions from B2B and financial services despite the increase in group revenue. B2B segment result fell to Rs 147.59 crore from Rs 163.24 crore, while financial-services segment result declined to Rs 6.05 crore from Rs 23.52 crore. B2C was the exception, with its segment result increasing to Rs 22.87 crore from Rs 18.18 crore.

Total segment results therefore declined to Rs 181.26 crore from Rs 211.74 crore. Finance costs outside financial services increased to Rs 5.79 crore from Rs 5.44 crore, resulting in continuing-operations profit before tax of Rs 175.47 crore. Financial-services finance costs were Rs 115.40 crore, down from Rs 130.54 crore, and are included within that segment’s performance measure.

Total expenses rose to Rs 2,118.70 crore in the September 2026 quarter from Rs 1,746.56 crore in the prior-year quarter. Employee-benefit expense increased to Rs 194.45 crore from Rs 151.07 crore, depreciation and amortisation rose to Rs 53.60 crore from Rs 42.02 crore, and other expenses increased to Rs 376.42 crore from Rs 309.72 crore. These reported cost movements coincided with the lower pre-tax profit.

What does KOEL's half-year cash flow show?

KOEL used Rs 202.94 crore in operating activities in the half year ended September 30, 2026, compared with cash generated from operating activities of Rs 367.74 crore in the corresponding 2025 period. Net cash used in operations was Rs 121.18 crore, against Rs 431.83 crore generated a year earlier, and income tax paid was Rs 81.76 crore.

The cash-flow statement records working-capital movements in financial-services loans and receivables, government-grant receivables, trade and other receivables, inventories, payables and provisions. Consolidated inventory rose to Rs 1,124.33 crore at September 30, 2026 from Rs 743.66 crore at March 31, 2026. This was accompanied by operating profit before working-capital changes of Rs 477.46 crore, compared with Rs 455.56 crore a year earlier.

Cash and cash equivalents were Rs 740.64 crore at September 30, 2026, down from Rs 764.20 crore at March 31, 2026. Non-current financial-services loans and receivables rose to Rs 3,695.01 crore from Rs 3,566.42 crore, while current financial-services loans and receivables were Rs 1,972.54 crore. Together, those two categories totalled Rs 5,667.55 crore at September 30, 2026.

What balance-sheet and portfolio changes did KOEL disclose?

KOEL reported total assets of Rs 11,501.05 crore at September 30, 2026, compared with Rs 10,852.44 crore at March 31, 2026. Total liabilities increased to Rs 7,721.88 crore from Rs 7,317.31 crore over the same period. Current borrowings decreased to Rs 1,281.49 crore from Rs 2,190.00 crore, while non-current borrowings increased to Rs 3,316.52 crore from Rs 2,132.86 crore.

Kirloskar Americas Corporation, a wholly owned KOEL subsidiary, acquired the remaining 490 units representing a 9% stake in Engines LPG, LLC, doing business as Wildcat Power Gen, on August 6, 2026. Following that transaction, Engines LPG became a wholly owned subsidiary of Kirloskar Americas Corporation. KOEL also said its transfer of the B2C Water Management Solutions domestic and exports business to wholly owned KOEL Fluid Dynamics Private Limited had no impact on consolidated financial results.

Conclusion

KOEL’s September 2026 quarter combined a Rs 333.41 crore rise in revenue with a Rs 48.25 crore decline in profit attributable to owners. B2B revenue increased by Rs 258.64 crore and B2C revenue by Rs 71.77 crore, but B2B segment result fell by Rs 15.65 crore and financial-services segment result fell by Rs 17.47 crore.

The next disclosures will show how the group’s Rs 1,124.33 crore inventory and Rs 5,667.55 crore financial-services loans and receivables develop after operating activities used Rs 202.94 crore in the first half. KOEL disclosed the August 6, 2026 completion of the Engines LPG acquisition and the internal B2C business transfer, both of which remain relevant to future consolidated reporting.