KSB

KSB has achieved a major milestone by reaching 100% indigenization for pumps used in nuclear reactor islands. The company has a ₹1,200 crore order book in this segment and plans to deliver 2 pump sets in CY25 (valued at approximately ₹100 crores) and a minimum of 4 sets in CY26. This localization strategy significantly enhances margins and reduces geopolitical supply chain risks.

The solar segment, primarily driven by the PM-Kusum scheme, contributed ₹183 crores in revenue for CY24. While the potential is massive with 800,000 pumps still to be installed nationally, the business faces a working capital challenge. KSB must pay PV panel suppliers within 7 days while government receivables take much longer, though management believes their strong cash position of ₹323 crores allows them to sustain this cycle.

The Valves business is outperforming with a 21% CAGR over the last five years, now making up 19% of total revenue. It is one of the company's most profitable divisions, maintaining EBITDA margins between 14% and 15%. Growth is being driven by new product launches like low-emission valves and expansion into export markets like Poland and Finland.

Recognizing that KSB is not yet a leader in the domestic residential pump market, management has launched a major branding offensive, including TV advertisements. The current residential base of ₹250-300 crores is seen as having the potential to double or triple. This shift involves moving toward a distributor-led model supported by 22 warehouses to ensure product availability.

KSB has successfully reduced its inventory holding from 96 to 83 days through standardized controls. To support future growth, the company is investing in new sheds and high-end multi-operation machinery at its Shirwal and Sinnar plants. Despite high utilization rates of 85-90% at older sites, these new investments are expected to provide the necessary headroom for the next 3-5 years.