Kirloskar Brothers Limited (NSE: KIRLOSBROS) Q1 2026 Earnings Call dated Aug. 04, 2025
Corporate Participants:
Unidentified Speaker
Sanjay Kirloskar — Chairman and Managing Director
RAMA KIRLOSKAR — Joint Managing Director and Managing Director of Kirloskar Ebara Pumps Limited (
Alok Kirloskar — Non-Executive And Non-Independent Director, And Managing Director Kirloskar Brothers International B.V.
Analysts:
Unidentified Participant
Sani Vishe — Analyst
Sunil Kothari — Analyst
Raj Shah — Analyst
Saurabh Mehta — Analyst
Vishal Kapoor — Analyst
Nishit Master — Analyst
Balasubramanian — Analyst
Rabindra Nath Nayak — Analyst
Prolin B. Nandu — Analyst
Presentation:
operator
SA. SA. SA. Ladies and gentlemen, you have been connected for Kiloskar Brothers Limited conference call. Please stay connected. We will begin shortly. Ladies and gentlemen, you have been connected for Kirloskar Brothers Limited conference call. Please stay connected. We will begin shortly. Ladies and gentlemen, you have been connected for Kiloskar Brothers Limited conference call. Please stay connected. The call will begin shortly. IT. SA. SAM IT SA IT Foreign. Ladies and gentlemen, good day and welcome to the Kiloskar Brothers Limited Q1FY26 earnings conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on your touch tone phone before we move on to the conference. A standard disclaimer. This conference call may contain forward looking statements about the company which are based on beliefs, opinions and expectations of the company as on the date of this call.
These statements are not the guarantees of future performance and involves risk and uncertainties that are difficult to predict. I now hand the conference over to Mr. Sanjay Kirloskar, Chairman and Managing Director from Kirloskar Brothers Limited. Thank you. And over to you, sir.
Sanjay Kirloskar — Chairman and Managing Director
Thank you. Good evening everyone. On behalf of Kerala Brothers Limited, I extend a very warm welcome to everyone for joining us on our call today. I hope you’ve had an opportunity to go through the financial results and investor presentation which have been uploaded on the stock exchanges and on the company’s website. On this call with me, I have Mr. Alok Karloskar, Managing Director, KBI, BV Ms. Ramakir Loskar, Joint Managing Director, KBL Ms. Bhavish Chada, our CFO and Strategic Growth Advisors, our Investor Relations Advisors. Let me begin my remarks by giving some business highlights for the quarter.
Consolidated revenue stood at rupees 979 crores, reflecting a 95% decline year on year. The quarterly performance was impacted by adverse seasonal trends and external geopolitical factors. The quarterly and early onset of the monsoon dampened our demand for our small farm segment which primarily serves the agricultural sector. On a positive note, the industrial segment continued to exhibit strong demand, highlighting the resilience and strength of our diversified product portfolio. On the international front, elections in the US and Thailand caused a temporary slowdown in both markets as procurement decisions were deferred. We view this as short term disruption with underlying demand remaining strong.
We expect momentum to improve in the coming quarter. EBITDA for the quarter stood at rupees 128 crores, remaining largely stable on a year on year basis despite the challenging operating environment. Importantly, EBITDA margins expanded to 13% compared to 12.3% in Q1 of last year reflecting a 70 basis points improvement. This improvement in margins was underpinned by multiple factors. A key contributor was the softening of raw material prices which helped ease input cost pressures. In addition, our strategic focus on operational excellence continued to yield results. We made progress in optimizing cost streamlining processes and improving resource utilization across all business verticals.
These initiatives collectively enhanced our productivity and ensured better absorption of fixed costs, thereby supporting profitability even in a subdued demand environment. During the quarter we recorded good order inflows in both domestic and international markets reflecting a year on year growth of 9% amounting to to rupees 1,336 crores. On the standalone domestic business performance for the quarter, revenue from operations stood at 621 crores reflecting a year on year decline of 7%. However, despite the top line softness, we delivered strong performance on the operational front. EBITDA grew by 10% on a year on year basis reaching Rupees 79 crores.
Standalone EBITDA margins improved significantly to 12.7% marking an expansion of 200 basis points. This improvement was primarily driven by favorable raw material pricing and the continued impact of our cost control and efficiency initiatives. As of June 2025, a standalone order book excluding the small pump business stands at rupees 1929 crores, reflecting a healthy and strong pipeline that underscores sustained demand across key business segments. In our international business, we registered a modest degrowth of 2% in Q1 FY26. This performance was primarily impacted by a temporary slowdown in the US and Thai markets largely due to election related postmortement.
However, offsetting the softness, SPP UK delivered a strong performance driven by robust execution of its healthy order book. With keen focus on strengthening our business outlook and supported by a robust order book, we remain optimistic about our future growth trajectory. Our overseas pending order book stood at rupees 1268 crores, further reinforcing our visibility and momentum in the international market. With this, let me invite Mr. Bhavesh Chada, our CFO to discuss the financial performance highlights. Thank you sir for the warm welcome. Good evening everyone. Let me start with financial performance highlights on a revenue front. The revenue from the operation for Q1FY26 stood at rupees 979 crore as against rupees 1031 crores in Q1 of FY25 on EBITDA front.
Our EBITDA for FY26 was rupees 128 crore and as against rupees 127 crores in Q1FY25. EBITDA margin for Q1. For FY26, 2.13percent as 12.3% in Q1FY25 on profit after tax funds. Our PAT for the Q1FY26 was rupees 68 crores as against rupees 66 crores in the last year. Same quarter last year. This is all from our side. We now being the question answer session. Thank you.
Questions and Answers:
operator
Thank you, sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch. Don’t telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we’ll wait for a moment while the question queue assembles. A reminder to all participants if you wish to ask any questions you may press star and one. Anyone willing to ask a question, you may press star in one. Now we have a first question from the line of Sani Vishe from Access Securities.
Please go ahead.
Sani Vishe
Thank you for taking my question, sir. So I understand this quarter maybe a seasonal thing given that we saw an earlier onset of monsoon. But is that the only factor concerning our domestic demand? And if that is the case, do we see, do we expect a clear recovery starting Q2?
RAMA KIRLOSKAR
Yes, good afternoon. We do expect to see a recovery in Q2. We believe that this was a seasonal phenomenon and that should improve. It should pick up in the next quarter.
Sani Vishe
Okay, so I. I just want to understand because in terms of margins, this quarter is a slight improvement. But what would be the expected range of margins for the whole year? I would assume it should improve further. Right. In terms of EBITDA margin.
Sanjay Kirloskar
You know, I have always said that we should strive to improve margins. So we don’t make such statements.
Sani Vishe
But directionally, I think if you Compare it with Q4, I think there is scope for improvement. That’s why I’m asking. Directionally there is further scope.
Sanjay Kirloskar
I think you’ll have to make your own judgment on that. I cannot make forward looking statements.
Sani Vishe
Okay.
Sanjay Kirloskar
Because the record of the last few years, I think you’ll have to make your own judgment.
Sani Vishe
Yeah, yeah, I can see that. Quarterly there is a trend of Q4. We are going on to going Q4. So. But my question is year on year improvement. Because we improved this year on the previous Same similar quarter. So that’s where I am trying to go that on quarter, on quarter can we see continuously improvement? I’m not asking in the Q4 in comparison to Q1 but rather maybe Q2 on last year’s Q2 and so on. But anyways if you. I understand that you are not making a forward looking statement. I just wanted a direction.
Sanjay Kirloskar
Yeah, we will strive to improve.
Sani Vishe
Okay, thank you.
operator
Thank you. We have our next question from the line of Pratik Kothari from Unique pms. Please go ahead.
Sunil Kothari
Hi. Thank you. Since the last call we had kind of called out some slowdown in our cash and carry model due to some liquidity issues at the client. Is it past that or not yet?
Sanjay Kirloskar
Could you ask that question again in the past quarter?
Sunil Kothari
Sure. We had called out that in our cash and carry model we were seeing. Some liquidity issues at the end customer. Level and we had to let go of some business. So just checking, has on ground things improved in terms of liquidity for our end customers?
Sanjay Kirloskar
You know our cash and carry business is for both sides small pumps business as well as small and medium pumps business. And I think we’ve already said that the small pumps business we had some issues because of the monsoon as far as the small and medium pumps business was concerned. Some of our direct dealers were affected by the issues at jjm. So yeah, we believe that that will ease out.
Sunil Kothari
Correct. Can we call out what was the industrial numbers of growth for this quarter? X of our retail firms.
Sanjay Kirloskar
Expected growth for the quarter.
RAMA KIRLOSKAR
Could you repeat that question please?
Sunil Kothari
Yeah, my question is what was the growth of for the industrial segment in our standalone business we called out at. Degrowth that we saw was largely because of retail pumps. So X of that how did industrials. Do.
Sanjay Kirloskar
Sector wise and application wise data? Hello.
Sunil Kothari
Yeah.
Sanjay Kirloskar
I think we have explained earlier that each of our competitors, none of our competitors, competes with us all across our business lines and therefore we do not give certain data.
Sunil Kothari
Fair enough. Thank you and all the best.
operator
Thank you. A reminder to all participants, if you wish to ask any questions you may press star and 1. We have our next question from the line of Raj Shah from aamc. Please go ahead.
Raj Shah
Thank you. I hope I’m audible, sir.
Sanjay Kirloskar
Yeah, there is a echo on this slide so we make ask some people to repeat. Don’t hear it properly. Go ahead.
Raj Shah
Yeah, so my first question was regarding the U. S business. I know you mentioned in the opening comments but if you can explain in detail that what led to this load on revenue as well as I see that we have there is some 250 basis point margin contraction as well.
Sanjay Kirloskar
Alok, would you answer that?
Alok Kirloskar
Yeah. Good afternoon. You know, I would say that there are two aspects. Our US business constitutes SPP Pumps Incorporated, which is the fire pump side of the business and Synchrofloor, which is the package solution side of the business. And both are SPP. Fire pumps is about 55% of the overall business. So in this mix we have seen that there is some packages that have got deferred on the synchro flow side because of the way the order book came about. I had mentioned, I think last quarter because someone had asked me the question about order booking after the election and I had mentioned that, you know, the order that got delayed into February time frame.
So because of that a lot of the jobs and orders are shifted out and they are in the third quarter for the US business which is the second quarter for the Indian business through which the numbers are reported. So I would say that shifted by a quarter and that’s caused effectively the revenue numbers to go down. And of course with the revenue numbers the general margin also to go down because usually we get, as you know, we’ve got good revenues coming out of the US business and that’s also giving us operating leverage which is what we’re losing when we’re not meeting the revenue threshold.
So I would say that the revenues have got shifted. I don’t think there’s a decline in margin. It’s just because we’re not getting the operating leverage at this point in time. And maybe I’ll take the opportunity because to also answer another point which may be to do with tariffs. The US business, like I mentioned, 55% of it is SPP pumps, fire pumps, that depends on products coming out of India. But usually the product is about 20% of the overall package value. So basically you’re looking at 20% of about 55% of the business being impacted from that point of view.
So hopefully I’ve answered a question that you wanted an answer for and maybe one that maybe others may have wanted an answer for. Thanks. Have I covered your question properly or not?
Raj Shah
Yes, yes. No, no. Thank you for detailed answer. Second question was regarding walls. So if, if I see a standalone order book in the ppt. So the wall section is seeing continuous decline. So last year in the same quarter it was around 87 crores. The part of order book now it has come down to around I guess 34 crores. So what has led to this continuous decline in the last four, five quarters?
RAMA KIRLOSKAR
There are some projects which they were working on which have been delayed. We are expecting to get those orders in the next few quarters. And the other aspect is they’ve already bought some orders but we’ve not really pushed them into our system. So they’re still pending because of the way that the customer has, the timing of the customer, when we’ve received the order. So this should increase in the next few quarters.
Sanjay Kirloskar
As you’re aware, most of our orders are for large wells and they come from EPC contractors. We are very careful about the commercial terms and unless everything matches our requirement, we do not book them into the system.
Raj Shah
Okay, perfect. Thank you very much. All the best.
Sanjay Kirloskar
Thank you.
operator
Thank you. We have our next question from the line off. Swam Mehta from East Lane Capital. Please go ahead.
Saurabh Mehta
Yeah, hi. Thanks for the opportunity. My first question was regarding. We mentioned in our annual report regarding the new submersible turbine pumps for the petrol pumps which we’ve launched. So just wanted to understand does it require some specific certifications like the UL79 PayTech approvals and do we already have those? Just wanted to get some clarification.
RAMA KIRLOSKAR
Yes, we have already gotten all the required approvals, a text and the like. Because this is a petroleum application and all compliances have been done accordingly.
Saurabh Mehta
Okay. Okay. So does it open up the whole market for us, the India market for. Us from here then?
RAMA KIRLOSKAR
Yes, it would. Retail petroleum application. Yes.
Saurabh Mehta
Got it, got it, got it.
RAMA KIRLOSKAR
Okay, so open the export market for us in addition.
Alok Kirloskar
Okay.
Saurabh Mehta
Okay. So if my understanding is correct, the this, this market was basically two international companies were having almost 80, 90% of the market and now we’ll be the third player who has all the requisite approvals, basically all the requisite certifications to be able to bid for all the orders, right?
RAMA KIRLOSKAR
Yes.
Saurabh Mehta
Got it, got it, got it. Thanks. Thanks. The next two questions were for alok. One was on the service business in uk, the Thames Water opportunity. How is it progressing? If you could give some update on that.
Alok Kirloskar
I think the service business in the UK is like I mentioned when you mentioned Thames Water, we have general framework contracts across most of the UK water utilities. They’re about 10 or 12 depending on how you count them based on the subsidiary parent relationship. But we have a framework with most of them. And at the moment, as I mentioned last time, we are starting AMP8 Asset Management Program 8 which started two months ago. Each AMP cycle, as I mentioned earlier, lasts for about five years. So we are in the 40th year, starting the 40th year of the AMP cycle, usually the first year of the AMP cycles have not been the best because companies are still evaluating their budgets and not spending all the money.
They tend to be better going towards the 2nd, 3rd, 4th, 5th year and of course towards the end of the cycle, as we’ve seen till now, of course, at the moment. But given the scenarios, and as you know, with Thames Water tethering on bankruptcy and maybe rescued by the government generally, the UK has been looking closely at how the UK water utilities have been using the subsidies they’ve been giving via the AMP cycle. And so we expect this time that there should be a better spending. As you probably know, because it’s available online, the AMP8 cycle is supposed to be £88 billion in total spend.
So I would say that it’s still early in the cycle. We are not seeing heavy. Spend on. The Service or the CapEx side as yet on AMP8 because it just started, like I mentioned, two months ago. But since you asked me, general service, I would say that general service in the uk, while it has been strong, there are some things that have been worrying us over the last few months. One is with high power prices, you would have seen that Jim Ratcliffe, who is a billionaire who owns ineos, which is a large chemical company in the north, has said that they are looking to close down a lot of their chemical plants. So as an example, we have a huge framework contract with ineos and if they close down their plant, because one of the reasons, of course, is net zero.
With net zero, power prices have gone up three times in the uk. So a lot of heavy manufacturing, whether it is steel plants, chemical plants, they are sort of in a very difficult scenario and many of them are closing down. So I would say that that de industrialization of the UK because of these policies is definitely an area of concern for us and we are seeing a little bit of a slowdown on existing framework contracts. At the same time, in line with net zero, there have been no renewal of the North Sea operations for many companies for their offshore platforms, because the labor government is right now wondering whether they should or they shouldn’t renew them in the context of net zero.
So again, because of that, there is a confusion on the operators whether they should move into decommissioning mode of all those rigs, which of course, as you would expect, would go, would further enhance the power prices. So given that scenario, I think it is a bit of a concern. We are keeping a lookout in terms of what happens. And so we do see reduced spending on existing framework contracts because there’s not much happening on the sites but that said we have added new contracts in power stations and other areas so we are trying to offset that as much as possible.
Does that answer your question?
Saurabh Mehta
Yes, yes, absolutely. So one more thing Alok so Rolls Royce is one that SMR competition, the Great Britain Nuclear. So how does it progress from here for us and how large and important opportunity could that be?
Alok Kirloskar
So we are approved by GBN and we are currently being approved by some of the large manufacturers of SMRs in the UK. So from that point of view I think it is positive. Also as you probably know GBN requires almost 60 to 70% UK content for the SMR program in the UK. So I would say that is also a positive from that point of view given that we are Britain’s largest pump manufacturer and we have a good reference base in power plants and of course as you know kbl, which is the parent company of spp, also has a good reference base in nuclear power plants.
So I would say that if you look at all those together we are quite well positioned for for the SMR opportunity through Great Britain Nuclear which is gbn.
Saurabh Mehta
So just a follow up on that to the India business as you mentioned. So are we approved suppliers for primary cooling pumps in India? And like we’re expecting some large orders from NPCIS for the fleet orders. So are we like are we approved for the primary pumps?
Sanjay Kirloskar
Saurabh, as I’ve mentioned earlier we did receive a development order a few years ago. We restarted work on that and we are well within the delivery schedules. It is my expectation that the Indian nuclear program, if it has to replace the fossil fuel station, will be so large that a lot of players will have to be allowed to come in. So we believe that we will be one of them when the orders are to be released. I think I’ve already explained that the development for the primary development order that I spoke about just now was for the primary heat transport program.
There are many other pumps, some which we are working together with NPCIL to ensure that we are able to participate. So we are funding some of these pumps. Two or three types of pumps which are required are self funded because we want to ensure that these pumps when they are required, we do get some of the orders and for the rest of the pumps, whether it’s heavy water, fast breeder, I think we have all the approvals required to participate in programs. We’ve also developed the boiler feed pump and delivered them, delivered the orders to rapp.
These were the first Indian designed and manufactured manufactured boiler feed pumps for The Indian nuclear program.
Saurabh Mehta
So my last question was regarding like a general capital allocation that how do we plan to use the cash on the balance sheet? Like given we are so somewhat been quite keen at expanding our service business, especially internationally, could we look to acquire a business there or are there any other areas which we are looking at to use the cash in the balance sheet?
Sanjay Kirloskar
You know this question was asked the other day in the shareholders meeting as well. Whenever there’s a good opportunity, that opportunity will be taken and that opportunity, you know, obviously the board of directors will have to look at, you know, to take it forward. But yeah, there is a large amount of cash sitting in the balance sheet which gives us the liberty or the opportunity to spend it either on capex, either on improving operational efficiencies or to grow organically, inorganically.
Saurabh Mehta
Got it, Got it. Thanks. Thanks a lot for answering all the questions. Thank you so much.
operator
Thank you. A reminder to all participants, if you wish to ask any questions you may press star and 1. We have our next question from the line off. Nishit Master from Access securities. Please go ahead. Nishit, are you there? Nishit, are you there? We’ll move on to the next question from the line of Vishal from Bandhan amc. Please go ahead. Hi.
Vishal Kapoor
So my question is on the standalone business. Could you elaborate a bit more as to what were the issues that we faced because of which we saw a year on year decline in revenue.
RAMA KIRLOSKAR
So I think there were a couple for the retail business. You know it’s a seasonal business. So because of the monsoon we did see a dampening of sales in rural India for our KOV business. There were some orders that did not go out and that’s one of the reasons for the lower sales this quarter. And as chairman had mentioned earlier there were some dealers in the distribution KOD distribution network that had cash stuck with the KGM projects and that’s one of the reasons why there was less cash for us in the market. So these were some of the reasons why our sales declined this quarter.
I hope that answered your question.
Sanjay Kirloskar
Hello, Vishal, are you there?
operator
Vishal? Vishal, can you hear me? We’ll move on to the next question. We have Nishit back in line. The next question is from the line of Nishit Master from Access Securities. Please go ahead.
Nishit Master
Yeah, thank you for taking my question. Am I audible? Yeah, yeah. So sir, two questions. One, if you could quantify the loss of business from Thailand and US because of elections, you know, percentage or amount. If the, if it was a normal quarter if you could quantify that.
Alok Kirloskar
I don’t think there’s a loss of business, like I mentioned that the sales have shifted, but our order book position continues to be stronger than last year. So executable order book position is stronger than last year. So I don’t think that.
Nishit Master
Yeah, so this revenue will come back in say Q2 or Q3.
Alok Kirloskar
Yeah, it will come back in their Q3 and KBS Q2.
Nishit Master
Yeah. Okay, thank you so much. And second, sir, you know, in the US business, you mentioned about the impact of tariffs, especially for material which we send from India. The other part of the business where we have local manufacturing now over there also a lot of primary material might be coming from say other geographies, you know, including say metal and things like that. And there have been greater amount of duty even for material which is say coming from Mexico or Canada. Have we taken any hit because of that? Because you know, there would have been increase in cost of production.
So have we been able to pass on that increase in cost of production or have we taken some hit, you know, because of the entire supply chain facing some tariff issues?
Alok Kirloskar
No, Nishit. I think in the other part of the business that is more fabrication orientated and the remaining components, which also include pumps, but pumps as a percentage of the total package, in that case maybe only 5 to 7% like I think we talked about in various other conferences. These are the large package solutions where we supply the entire pump house which is prepackaged in our facility and dropped off at the site. And these include solutions like I mentioned for data centers as well as large booster pumping schemes for city municipal water requirements. So I would say the remaining components are mainly US sourced, including the sheet fabrication for the steel plates for the steel.
So I would not say that that is vastly impacted. But yes, of course the pumps come from India even for that. But it’s a very small portion, like I said, It’s 7 to 8% of the total value of the product. So it’s less impacting from that point of view.
Nishit Master
So is it fair to say that we are in a far better position than other competitors in US and thereby there is a chance of us actually gaining market share in US Now.
Alok Kirloskar
I think, I mean, I would like to think we’re in a better position, but I would, you know, nobody else is a fool either, right? I’m sure they’ve hedged their supply chain away from China and other places, but. But we would not know that until we wait for maybe a quarter or two quarters because obviously.
Nishit Master
15% for say, most other economies. Right. The best base tariffs have been 15% for most of the guys. Even that 15% for the entire 100% of import content would be significantly higher than, you know, us facing, say a 25% tariff on 20% content.
Alok Kirloskar
Yeah, possibly. And also, I mean it’s important to note most of our large competitors and the large manufacturers in America and pumps normally get their pumps from either China or from Vietnam as an example. Of course, some make them in America as well, but I would say those are the main sources for them. So, you know, if you ask me off the cuff, I would hope that we are in a better position, but I cannot imagine that any of them are foolish. I’m sure that they also have redundancy in the system. So we would only know the real scenario.
Probably one or two quarters down, sir.
Nishit Master
Done. Thank you so much and best of luck.
Alok Kirloskar
Thanks.
operator
Thank you. A reminder to all participants, if you wish to ask any questions, you may press star and 1. We have our next question from the lineup. Bala Subramanian from Aryan Capital Markets, please go ahead.
Balasubramanian
Good evening, sir. Thank you so much for the opportunities. Sir, my first question, the new subscription based model aims to replace traditional AMCs. So what is the adoption rate and what percentage of service revenue contributes right now?
Sanjay Kirloskar
You know, Kerlosmart by more and more people? Like I said earlier, we do not give revenue figures or growth figures sector wise or business wise. Point.
Balasubramanian
Okay, sir. So under touch entities it’s been negative margins in this quarter. Is this yet temporary issues like project delays or any structural issues like pressuring pricing pressures and what kind of specific measures we are being implemented to improve the profitability, especially products mixed or cost cutting. You could throw some light on that. Hello?
Alok Kirloskar
Yeah, I think, yeah, you know, I think last year we mentioned that they’ve turned around the Dutch entities and. And the order book is still very strong for such entities. It’s mainly execution of the job is not happening in the current quarter. We expect that as they execute their jobs they should be in a budget situation. So I think we are really focusing on that aspect in ensuring that we are executing.
Balasubramanian
So my last question, this SPP UK service side and are we expanding beyond pumps like a gearbox as compressors to offset industrialization de industrialization in Europe?
Alok Kirloskar
Yes, I think in my, in the last call I had mentioned that already where we have sites under control, we have moved from just pumps to gearboxes and of course in some cases engines. We’ve not yet moved to compressors and steam turbines. But that’s how we see the progression, you know, in terms of service. So yes, where possible we have added more and more items into our. Into our mix and that is our objective also.
Balasubramanian
Got it sir. Thank you.
operator
Thank you. We have our next question from the line of Rabindranath Nayak from Sunidhi Securities. Please go ahead.
Rabindra Nath Nayak
Hi. Thank you for the opportunity. Sir, you mentioned that in this quarter there is a decline in the retained small fund segment with due to which sales has declined. So first question, what is the status right now in this quarter so far? In this second quarter so far. And does it explain that the your yoy the standard margin has increased from 3.7% margin and also gross margin is expanding. So Judy has explained the industrial contribution is higher. The.
RAMA KIRLOSKAR
Yes to answer. Well, I can’t answer your first question because that would be a forward looking statement. So I will refrain from doing that. But yes, our industrial growth was good and that was one of the reasons why you see the increase in margins.
Rabindra Nath Nayak
Okay. And about the. It just gives an idea of what is the startup so far in this quarter. Whether it is, you know, it is a comeback or it is the main status quo.
Alok Kirloskar
What is that?
Rabindra Nath Nayak
You can give some ideas of that.
RAMA KIRLOSKAR
Well, we do see the cash situation improving in the market. But that’s about all that I can say tell you.
Sani Vishe
Okay.
Rabindra Nath Nayak
And what is the service contribution in the. You know in the process other subsidiaries business non standard on business in this quarter.
Sanjay Kirloskar
What is the contribution of what services.
Rabindra Nath Nayak
Business particularly services contribution in the. In our subsidiaries business.
Sanjay Kirloskar
We don’t disclose this service business contribution as well. But the subsidiaries. I think the subsidiary numbers are given in the presentation very clearly.
Rabindra Nath Nayak
Okay. Because why the margin rate contractor whether service is enough the contribute it has contributed fairly as expected last year or it is some disappointment there in the southeast countries. And that is the only thing I’m asking.
RAMA KIRLOSKAR
It is in line with last year.
Rabindra Nath Nayak
Okay.
Alok Kirloskar
Okay. Are you asking domestic business or international business?
Rabindra Nath Nayak
International business.
Alok Kirloskar
The international business. It’s a little less than last year.
Rabindra Nath Nayak
Okay, thank you.
operator
Thank you. A reminder if you wish to ask any question you may press star and 1. A reminder to all participants if you wish to ask any questions you may press star and 1. We have our next question from the line of Saurabh Mehta from Eastlant Capital. Please go ahead.
Saurabh Mehta
Yeah, hi, just had a couple of more questions. So one was on the data center opportunity in us. How is it coming about like if you could just talk about it. How large could it be? Any key clients we are able to crack in last Few months. Just some update on that.
Alok Kirloskar
I think last time we spoke about this, you know, in terms of data centers, we had mentioned that usually in data centers we supply the cooling package which normally are the primary secondary or primary and secondary both. What we don’t supply is the on chip cooling package which is a separate package which some manufacturers do supply. And the third package that we supply is the firefighting set. I had mentioned also the last time that we have moved from just supplying pumps to, to supplying containerized systems. And that’s really what we’re focusing on with the plug and play scenario for all these packages.
So at the moment, apart from having the framework agreement like we said with Amazon, people like Google, Microsoft as well as Facebook who is called Meta, we mainly supply them project to project. The only ones we have a framework with are Amazon. The other point is that we’ve also now slowly added a lot more companies like as an example Equinix and others who are more private equity oriented because we are seeing now slowly more and more private equity companies are coming in and doing work in data center because data center cash flows are utility style cash flows.
So slowly we’re adding those companies in as clients. So I would say the opportunity is basically supplying these two major two to three major packages. Usually these two to three major packages, if you go by package value would be around, together would be around 5 to 7 million dollars per data center. And I think you can probably get from anywhere the number of data centers coming up. But of course there are many, many, many data centers coming up in the US as well as in Asia. So I would say that that probably sums up my thoughts about data center.
Do you have anything specific you want to ask or do I covered all the points?
Saurabh Mehta
No, this is very good. So for example, if we are suppliers to Amazon and it could be to other geographies as well, right? Not just the limited to us.
Alok Kirloskar
I mean to be fair, majority of the data centers as you know are coming in the US by far and by far and away the other countries have been talking about data centers, but the number of actual data centers on the ground is limited. But yes, to answer your question, we do have Amazon data centers in Europe, we have Google data centers in Europe as well, places like Sweden and other places like that. So we do supply to them. But in terms of a single market with the largest opportunity, I think it’s still the US when it comes to data centers.
Saurabh Mehta
And would it be fair to say that, you know, this business in the US sub would be probably the Highest growing segment.
Alok Kirloskar
For us in the us.
Saurabh Mehta
Yes, yes.
Alok Kirloskar
It would be because I mean, as you know, the countries that we operate in, whether it’s America, the uk, Europe as an example, the growth rates are very slow and very low in these countries, if there’s any growth at all. The US of course has been good recently. But so really the growth for the international business comes from focusing on some of the bright spots in the economy. And like you said, data centers is one of the bright spots. So yes, a lot of the growth would come from these kinds of new, new areas of growth.
Saurabh Mehta
And I had one more follow up question on the domestic business on the fuel pump opportunity. Is it possible to understand the sales cycle of how this business works? Like how much is the greenfield, how much is the replacement cycle and.
Alok Kirloskar
Like.
Saurabh Mehta
How large can this opportunity be in domestic and also some color on exports? Which geographies are we targeting?
RAMA KIRLOSKAR
So you know, we have just finished our development supply of this order so we will need to wait for another six months to really understand the size of this opportunity. It’s too early to tell as of now.
Alok Kirloskar
Sure.
Saurabh Mehta
Thank you.
operator
Thank you. We have our next question from the line of Prolin Nandu from Edelweiss Public Alternatives. Please go ahead.
Prolin B. Nandu
Yeah. Hi team. Thank you for giving me the opportunity. My question is on order book, right? And for that matter the on slide 10, right where you give the breakup of the order book and in that order received. Right. If I look at the KBL and domestic subsidiary number, the order book is, you know, down year on year, right? Order received, right. 932 crores versus 943 crores last year in the same quarter. While I understand that you know, there could be quarterly fluctuations and in the last call you also mentioned that you don’t want to sit on a very large order book, right? Because execution timelines maybe are coming down.
But is there anything specific that you want to call out for a degrowth in order received number for the domestic business or is it business as usual and even let’s say compared to last year, are the execution timelines coming down? How should one think about the timelines for the orders that you are receiving? Let’s say in the recent quarters, this.
Sanjay Kirloskar
Is business as normal. The order intake fluctuates from quarter to quarter based on customer requirements. All I can say is we haven’t lost any orders that we have been quoting for in the last one year. It’s more dependent on seasonality. It is dependent on how customers place orders on us. Some quarters you’ll see large amounts of orders, some you may not. The number of pumps that we are delivering, as we’ve said, is ever increasing. And also as we have explained earlier, a large number of pump sets have now gotten converted into pumps. So it’s a combination of all these factors that you are seeing not only affect the top line but also the bottom line and the balance sheet.
Prolin B. Nandu
Sure, I get your point. Similarly, you know, in your overseas subsidy right there, the order is, has increased quite a lot. Right. On a year, on year basis. That also is largely business as usual. Or are there certain orders that you have probably received which could be, you know, lumpy in nature or is it more this just the reason that you gave for the domestic business? Is it similar for the overseas business as well?
Alok Kirloskar
No, actually, yeah. No, actually I would say that the international business, I mean, yes, there are some lumpy jobs but generally like I mentioned earlier, with a lot of the headwinds that are being faced in Europe and also UK I would say that those jobs that they have got are probably lower than what we would have expected to get because obviously there’s a reduction like I mentioned, in terms of the available service business also because of just the industrialization taking place in the UK and some other countries due to power prices.
That’s what I would say really that it could have probably been in a better scenario if the markets are stronger.
Prolin B. Nandu
Sure. And one question on margins, while you again answer to previous participants question that there is a mixed impact here. Right. But if I look at let’s say recent 12 odd quarters, your gross margin are the highest, right. By in, you know, in the recent 10 to 12, 12, 12 to 14 quarters. So is the entire gains that you have probably seen in gross margin on a year on year basis explained by the mix change or some of the gains, gains that we have talked about on the previous call.
On the production side, on the efficiencies that we are working on at Pirloos Karwadi, are those also, you know, the reason why gross margins have jumped? Right. Because I understand that maybe overall revenue is down 5% and that might take a, you know, have some impact on EBITDA margin because of lower scale. But on the gross margin side, is it purely the mix impact or are there some efficiencies which are also, which we are also, you know, seeing. And that’s what is, you know, visible in margins.
RAMA KIRLOSKAR
It is a combination of all the factors you mentioned, its product mix as well as the operational efficiency improvement.
Prolin B. Nandu
Okay, thank you team. That’s it from my side.
Sanjay Kirloskar
Yeah. The only thing I’d like to like all the part participants to understand is, I mean, and I’ve been saying this for quite some time, we not only are very selective with orders, but we also recognize orders only after they meet all our conditions. Right. So there may be orders that are in that customers have placed on us, but we haven’t fully brought them into our system.
Prolin B. Nandu
Got it. Thank you for that clarification.
operator
Thank you. As there are no further questions from the participant, I now hand the conference over to Ms. Rama Kirloskar for closing comments. Over to you, ma’. Am.
RAMA KIRLOSKAR
Thank you. We thank everyone for joining the call today. We hope we’ve been able to give you a detailed overview of our and answer your queries. Should you have any further questions or clarifications, please feel free to reach out to sga, our investor relations advisor. Thank you.
Sanjay Kirloskar
Thank you.
Alok Kirloskar
Thank you.
operator
Thank you on behalf of Kirloskar Brothers limited. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.