Kirloskar Brothers Ltd

It gives me immense pleasure to present to you the 105^th Annual Report of Kirloskar Brothers Limited (KBL) for the fiscal year 2024-2025. This year's report is more than a review of our performance; it reflects the remarkable transformation that our organisation has embraced — a transformation rooted in resilience, foresight and our relentless pursuit of excellence.

The theme for this year, "Transformation — Unleashing True Potential", is both timely and deeply meaningful for us, as it encapsulates not just what we have achieved but the spirit with which we are preparing to redefine possibilities for the future.

We are witnessing an era of unprecedented change across the global industrial landscape. The pace of transformation driven by shifting economic paradigms, rapid technological advancements and evolving customer expectations is accelerating. Markets today are more interconnected than ever and businesses are compelled to operate in an environment where agility, innovation and sustainability are not just competitive advantages but essential requisites for survival and growth.

At KBL, we have always believed in the importance of anticipating change rather than reacting to it. Over the past year, we have navigated the complexities of volatile commodity prices, geopolitical disruptions, environmental challenges and fluctuating demand cycles. While these dynamics have assessed industries globally, they have also opened avenues for innovative business models and product portfolios.

In particular, the Indian infrastructure and energy sectors, crucial contributors to the country's economic ambitions, are undergoing rapid modernisation. Significant investments in water infrastructure, smart cities, nuclear energy and renewable power generation present new opportunities for value creation. Internationally, the demand for energy-efficient and sustainable pumping solutions is growing steadily, driven by stricter environmental regulations and rising consciousness about resource conservation.

The Trump tariffs, introduced as part of a broader protectionist policy, have contributed to economic instability by disrupting global supply chains and increasing costs for businesses worldwide. However, KBL and its subsidiaries are well-positioned to withstand these challenges. With over 70% localisation in our manufacturing facilities across global operations, KBL has significantly reduced its dependence on imported components. This strong localisation strategy ensures minimal impact from external trade barriers and tariffs, allowing the Company to maintain operational stability and continue delivering value to its customers worldwide.

Transformation for KBL is not confined to external market shifts, it is equally about how we are reinventing ourselves from within. Our operations, product development, customer engagement and supply chain ecosystems are being increasingly infused with innovative technologies.

The integration of Industry 4.0 principles, including advanced automation, data analytics and smart monitoring solutions, is enabling us to enhance operational efficiencies, predict maintenance requirements and deliver superior customer experiences. Our research and development initiatives are aligned to future-ready technologies such as IoT-enabled pumps, AI-driven monitoring systems and remote asset management tools, ensuring that our offerings remain ahead of the curve.

We have also invested in digital platforms and intelligent business systems that are streamlining our internal processes and decision-making. From manufacturing plants adopting smart manufacturing protocols to customer service platforms providing real-time support, digitalisation has become a cornerstone of our strategy to unlock greater productivity, responsiveness and reliability.

A particularly exciting chapter in our transformation journey has been our growing participation in India's nuclear power programme. As the country seeks to expand its nuclear energy capacity programme to meet clean energy targets and ensure energy security, KBL is proud to be playing a pivotal role by supplying high-precision, critical locally developed pumping systems for nuclear installations. We expect to deliver the first Indian-designed primary heat transfer pump for the pressurised heavy water fleet programme, within the agreed timelines.

Our experience and engineering excellence in manufacturing nuclear-grade pumps uniquely position us as a trusted partner in this strategic sector. It is a testament to our technical capabilities and commitment to quality that KBL continues to be among the select few Indian companies certified to supply to this highly specialised domain.

Going forward, we see immense potential in expanding our contributions to nuclear power projects, both in India and globally. This aligns with our broader strategy of participating in high-value, technologically demanding projects that reinforce our brand's legacy while opening new avenues for growth.

In the evolving industrial narrative, sustainability is no longer an optional agenda but an essential part of responsible business practice. At KBL, sustainability has always been intrinsic to our ethos, manifesting in the energy-efficient products we engineer, the resource-conserving processes we adopt and the community-centric initiatives we champion.

Our integrated approach to sustainability encompasses environmental stewardship, social responsibility and economic value creation. During the year, we have made noteworthy progress in reducing our carbon footprint, optimising water usage and improving waste management practices across our operations. The development of energy-efficient pump sets and water-saving solutions is enabling customers to achieve their own sustainability goals while contributing to a cleaner environment.

Moreover, our focus on employee well-being, safety, skill development and diversity has fostered a workplace culture where talent is nurtured and innovation thrives. Through our CSR initiatives, we have continued to engage with local communities in meaningful ways, promoting education, health and sustainable livelihoods.

As we stand on the cusp of a new growth cycle, our vision for KBL is clear - Enriching Lives across communities through innovative and sustainable engineering solutions. Our strategic priorities are anchored around four key pillars that will shape our journey forward. First, innovation-led growth, where we will continue to invest in research and development, create next-generation technologies and expand our product portfolio to meet the evolving demands of the infrastructure, energy, water and industrial sectors. Second, we remain committed to operational excellence, enhancing efficiency, quality and agility through digitalisation, lean practices and world-class manufacturing standards. The third pillar is customer-centricity, as we strive to strengthen our engagement by offering intelligent, customised solutions and comprehensive life-cycle support that maximises operational uptime and optimises resource utilisation. Lastly, our focus on sustainable leadership reflects our dedication to embedding sustainability in every aspect of our business, from eco-efficient product designs to ethical governance and inclusive community development. Together, these priorities will empower KBL to create enduring value for all stakeholders and drive meaningful progress in the years ahead.

Looking ahead, the global pumping industry is poised for transformational shifts, driven by megatrends such as urbanisation, industrial automation, climate change and digitalisation. At KBL, we are proactively responding to these trends with progressive ideas that will shape the future of fluid management.

Our vision includes developing smart pumping systems capable of predictive diagnostics and autonomous operation, integrating renewable energy-powered pumps for off-grid water supply and pioneering modular solutions for decentralised infrastructure projects. We were the first pump company to introduce such loT based systems, ensuring that data resides in India. Furthermore, by expanding our footprint in niche and high-growth segments such as nuclear power, desalination and wastewater management, we aim to build a resilient, diversified business portfolio capable of delivering long-term value to our stakeholders.

Transformation is not a destination but a continuous journey of evolution and reinvention. At KBL, this journey is guided by our legacy of over a century of engineering excellence and our unwavering commitment to building a future that is smarter, sustainable and inclusive.

As we move forward, I would like to extend my deepest gratitude to our customers, business partners, employees, shareholders and community stakeholders for their unwavering trust and support. Your belief in our capabilities inspires us to push boundaries, embrace new possibilities and truly unleash the potential that lies within.

Together, let us embark on this exciting new chapter of transformation and progress.

Chairman and Managing Director