KSB Limited
Know the Company
KSB Limited, a subsidiary of the German multinational KSB SE & Co KGaA, was established in 1960 in Pune. Over the past six decades, KSB has become a leading manufacturer of pumps and valves, serving a wide range of industrial sectors, including water and wastewater management, energy, construction, process industries and agriculture. Renowned for its high-quality products and solutions, the company is committed to meeting the diverse needs of its clients across those sectors.
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KSB’s extensive product portfolio includes centrifugal pumps, submersible pumps, industrial valves, and automation systems. These products are engineered to deliver exceptional efficiency, reliability, and durability, making them ideal for both standard and customized applications. The Company has an impressive annual manufacturing capacity of 150,500 pumps, 186,000 valves, and 6,000 tonnes of castings (mainly for captive use), ensuring a steady supply of products to its customers.
KSB has seven manufacturing facilities in India out of which five are located in Maharashtra and one each in Tamil Nadu and Kerala. These facilities adhere to strict quality standards to ensure that products meet global standards. The company’s robust infrastructure includes four zonal offices, six service stations, and 14 branch offices, supported by a vast network of 350 authorized service centers and over 1,100 dealers. KSB’s impressive clientele features industry giants like BHEL, Indian Oil Corp, Siemens, and Larsen & Toubro, reflecting its strong market presence.
Strengths
KSB has a track record spanning over six decades in the Indian pumps and valves market, initially focusing on the industrial segment. Recently, the company has expanded its portfolio to include pumps for domestic use and has begun manufacturing critical components locally. KSB now demonstrates diversified growth by securing orders across various segments. The company has achieved several milestones in the recent past, including securing a substantial order for auxiliary pumps, receiving orders from government schemes, and obtaining export orders from international clients. Last year, the company introduced several significant initiatives, including receiving its first order for reciprocating pumps, which marked a major expansion of its product range. Additionally, KSB secured its first-ever order as an FM packager in the fire-fighting sector, qualified in the SECI (Solar Energy Corporation of India) tender, and commenced supplies for the PMKUSUM scheme.
KSB Ltd has strategically positioned itself to mitigate industry risks through well-structured strategies such as resource allocation, capacity expansion and forming strategic partnerships. This approach not only enhances the company’s resilience but also boosts its ability to capitalize on emerging opportunities. By investing in automation and digital solutions, KSB is set to further improve operational efficiency and cost competitiveness. These investments are vital in maintaining the company’s market leadership, as they enable KSB to deliver high-quality products with reduced times, ultimately benefiting its customers across various industrial sectors.
The Indian pumps and valves industry is poised for significant growth, driven by the country’s robust economic expansion and the government’s focus on infrastructure development. KSB stands to benefit immensely from this favorable environment. Government of India’s increased investments in irrigation, water supply, sanitation, and urban housing projects will drive demand for pumps in the water segment. Apart from this, greenfield projects and capacity expansion initiatives in industries such as petrochemical, steel, cement, water, wastewater and power segment are expected to boost demand for both pumps and valves. KSB’s broad product portfolio and industry expertise position it well to capture a significant share of this growing market.
KSB’s introduction of innovative products such as the PMSM Motor and AC Solar Motor, along with the MNRE Certification for 33 models, demonstrates its commitment to technological innovation. These advancements, coupled with the Govt support KSB able to get orders for hundreds of solar pump sets across India.
In a strategic move to strengthen its nuclear business capabilities, KSB has introduced cutting-edge machinery at its facilities which all are essential for ensuring the reliability and efficiency of critical pumps used in nuclear segments. The new machinery not only augments KSB’s capacity, particularly in terms of weight and speed considerations with precision technology, but also underscores the company’s commitment to maintaining stringent quality standards. By keeping critical operations in-house, KSB reinforces its position as a leader in the nuclear industry, demonstrating its ability to meet the exacting requirements of this highly specialized market. As of March,2024, the Company having an order book of around Rs 1,000 crore from the nuclear segment only.
KSB’s involvement in India’s National Green Hydrogen Mission is another testament to its forward-looking approach. The mission aims to establish plants with a total electrolyzer capacity of up to 60-100 gigawatts to generate 5 MMTPA of green hydrogen by 2030. Pumps and valves are crucial components in the hydrogen production process. As KSB’s expertise in industrial and chemical processes positions it will be a key player in this transition. The company’s extensive product range and deep knowledge of systems engineering, materials, and energy efficiency enable it to provide cutting-edge solutions that support the development of green hydrogen infrastructure in India.
In the life sciences sector, KSB has expanded its product offerings with the LSA Series, catering to the specific needs of food and beverage production, dairy, pharmaceutical, and personal care applications. As a full-range supplier, KSB provides pumps and valves that are optimized for hygienic process engineering, ensuring the highest quality and compliance with stringent hygiene standards. These products are designed to guarantee absolute process reliability, making them ideal for various applications in the food and beverage industry. KSB’s focus on quality and innovation in this sector further strengthens its reputation as a trusted supplier of critical equipment for life sciences applications.
KSB Ltd.’s commitment to the “Make in India” initiative is represented by its recent introduction of locally manufactured canned motor pumps. This achievement marks a significant milestone in the company’s journey toward self-reliance and innovation. The launch of the Etaseco RVP pump, proudly manufactured in India, represents a breakthrough in technological excellence. This pioneering product has been offered for prototype testing on the Vande Bharat train, showcasing KSB’s ability to support transformative projects in India’s rail transport sector. Through rigorous testing and a steadfast commitment to quality, KSB is revolutionizing the industry and contributing to the nation’s industrial growth.
The company’s export business also shown a positive trend, with increasing demand for its products in international markets. This growth is a testament to KSB’s commitment to quality and excellence. As part of its Strategy 2024, KSB has expanded its footprint into new market segments such as solar and green hydrogen, and has enhanced its product portfolio with new launches. These developments reflect KSB’s ability to adapt to changing market dynamics and continue delivering value to its customers worldwide.
Financials and Balance Sheet
KSB Ltd follows a January to December calendar year as its financial year. The Company reported a net profit of Rs 68.6 crore in the second quarter of the current fiscal year, ie, June, 2024 compared to Rs 64 crore in the same quarter last year. Its sales stood at Rs 646 crore, an increase of 9% compared to a year ago. KSB has also maintained a strong financial structure, running with almost zero debt. The company’s return ratios have shown significant improvement over the last five years. For instance, RoE has increased from approximately 13% in CY19 to around 17% in CY23.
Outlook
The outlook for the Indian pumps and valves industry is highly promising, fueled by the country’s growing investments in infrastructure, including housing, irrigation, water supply, and key industrial sectors such as refineries, chemicals, and power. As a leading player in this industry, KSB is well-positioned to capitalize on these developments. The increasing capital expenditure in these areas is expected to drive significant demand for pumps and valves, providing KSB with ample opportunities to expand its market share and enhance its business prospects.
KSB’s strategic initiatives are aligned with the evolving market dynamics, focusing on untapped geographies and diversifying into new business segments such as hydrogen, firefighting and railways. This approach not only broadens the company’s product offerings but also opens up new revenue streams. The emphasis on the aftermarket business, including the provision of readily available spare parts and on-demand services, further strengthens customer relationships and enhances long-term profitability. KSB’s commitment to innovation and energy-efficient solutions positions the company to meet the growing demand for sustainable products in the industry.
The company has demonstrated consistent growth over the past couple of years and is poised to continue this trend, going forward, supported by expanding its domestic distribution network and service infrastructure. While global economic conditions may slow export growth, the robust domestic market and strategic expansion plans will help KSB navigate these challenges. Overall, the industry is set to experience sustained growth, driven by technological advancements and a strong focus on sustainability, ensuring that KSB remains a leader in the pumps and valves sector.
Risks
A slowdown, if happens in the Indian or global economy could lead to reduced demand for infrastructure projects, which would directly impact the sales of KSB Pumps. KSB required on various raw materials, such as steel, copper and other metals. Significant fluctuations in these metal prices may affect the Company’s production costs and adversely affect profitability.
Stiff competition also a cause of concern because the pumps and valves industry is highly competitive, with KSB facing challenges from both domestic and international players. This competition could put pressure on KSB’s market share and pricing strategies.
Sector: Industrials
Market Price: Rs. 916.90 as on today
FV: Rs 2/-
Stock Name: KSB Ltd
BSE Code: 500249, NSE Code: KSB
Market Cap.: ₹16160 Crore
Book Value: Rs. 77.6
Segment: Industrial Pumps and Valves
Incorporation: 1960
Headquarters: Pune, Maharashtra
