KSB Ltd Management Discussions.



The Company is engaged in the business of manufacture of power driven pumps and industrial valves. Castings are mainly produced for captive consumption.



Global growth is expected to decelerate markedly to 4.1% in 2022, after rebounding to an estimated 5.5% in 2021, reflecting continued COVID-19 flare-ups, diminished fiscal support, and lingering supply bottlenecks. The near-term outlook for global growth is somewhat weaker, and for global inflation notably higher, than previously envisioned, owing to pandemic resurgence, higher food and energy prices, and more pernicious supply disruptions. Global growth is projected to soften further to 3.2% in 2023, as pent-up demand wanes and supportive macroeconomic policies continue to be unwound.

In India, the economic damage caused by the second wave has already been unwound with output effectively back to levels reached prior to the pandemic as COVID-19 cases and restrictions subsided. Indias economy is expected to expand by 9.2% in fiscal year 2022, unchanged from last Junes forecast as the recovery is yet to become broad-based. The economy should benefit from the resumption of contact-intensive services, and ongoing but narrowing monetary and fiscal policy support. In FY2022 and FY2023 growth has been upgraded, to 8.7% and 6.8% respectively, to reflect an improving investment outlook with private investment, particularly manufacturing, benefiting from the Production-Linked incentive (PLI) Scheme, and increases in infrastructure investment.

Pumps and valves industries

With an annual turnover of Rs.200 billion and annual production of 4.5 million pumps, Indias pumps and valves industry is the fastest growing in the Asia Pacific region. The growing demand for pumps and valves by industries in almost all major sectors, especially industry, oil and gas and water and wastewater, is a major inducement for further growth in Indias pumps and valves sector.

Investment in infrastructure, sanitation, energy, manufacturing, and real estate is expected to sustain in the medium to long term. Government support to boost economic development is also expected to provide an attractive avenue for the pumps and valves industry.


The broad uptick in private capex and the general momentum of government investment presents opportunities for growth of the industry. The Company continues to focus on augmenting the product offerings, identify emerging opportunities and deploy necessary resources to capitalize on them.

Necessary mitigation actions for threats from supply chain disruptions, commodity costs, competition are actively implemented with continued focus on evolving our existing competence.


During the year under review, pumps and related spares worth Rs.12,474 Million (Previous year Rs.9,570 Million) and valves and related spares worth Rs.2,336 Million (Previous year Rs.1,991 Million) were sold. Out of the above, export of pumps, valves and their spares in terms of value were Rs.3,025 Million (Previous year Rs.2,339 Million)


In line with the general economic outlook and the pickup in industrial capex, the Company expects the market for pumps, valves and services to grow reasonably well. The export sector is also expected to grow moderately; provided the pandemic effect and the commodity price pressures subside gradually.


Risks to the outlook are primarily to the downside. All regions are vulnerable to continued outbreaks of COVID-19 and the spread of new variants of the virus. Risks related to financial stress due to rising inflation, hawkish monetary policies, geopolitical tensions, increasing energy prices can adversely affect economic activity. With entry of more players in the domestic market, competition is expected to be more aggressive leading to price pressures. Uncertainty in global economic growth is expected to impact the growth rate in India and consequently the Companys operations.


Internal Control Systems are implemented:

• To safeguard the Companys assets from loss or damage.

• To keep constant check on cost structure.

• To provide adequate financial and accounting controls and implement accounting standards.

The system is improved and modified continuously to meet with changes in business condition, statutory and accounting requirements.

Internal controls are adequately supported by Internal Audit and periodic review by the management.

The Audit Committee meets periodically to review -

• Financial statement, with the management and statutory auditors.

• Adequacy/scope of internal audit function, significant findings and followup thereon of any abnormal nature, with the internal auditors.


Cost reduction have been achieved in certain areas by implementing efficiency improvement programme within the company.

The following statements cover financial performance review, which are attached to this report.

a) Distribution of income

b) Financial position at a glance

c) Financial summary


The spread of COVID-19 has disrupted businesses worldwide which has led to dramatic changes in how businesses act and the way stakeholders behave. In just a few months time, the COVID-19 crisis has brought about years of change in the way Companies do business and work environment. Despite the havoc wreaked by COVID-19 pandemic in last two years, with our collective efforts and steadily improving confidence, we have attained good progress in business. To stay competitive in the business and economic environment, we focused on our strategy and continued bringing new practices by keeping the business & our employees at the core. Three ways the Company has mitigated uncertainty is by adopting Digitalization & Innovation, by redesigning work processes & by enhancing our employee experience. With this backdrop, we have implemented various measures like restructuring the organization of various departments to meet the business expectations, introduction of new business segments and Innovation Cell, Diversity & Inclusion, Employee Engagement activities, Open Communication Platforms, focus on Health and Safety to embrace the culture of strong Values. The Company has been attentive towards health of our employees and workmen through vaccination camps and support to family of the deceased employees and workmen due to COVID-19. To deliver sustainable organizational performance, we focused upon skill and knowledge enhancement, retention of employees, leadership development, performance management and employee engagement mixing it with the comparable amount of process reformation. The process advancement affected the way employees are hired, developed and managed to the way they communicate, interact and contribute to the business requirement. Our constant efforts on the Reward and Recognition, Competence and Career Development, Development of Infrastructure, Communication Mechanisms, Succession Planning and Compensation restructuring and revision helped us to mark our attrition rate much below than the industry standard. Healthy employee relations at all plants ensured balanced and responsible operations having a great impact on the quality of products and services and in establishing us as a strong brand in the market. For 60+ years, KSB India has been committed to sustainable and responsible business practices. Under this initiative we are focusing and building on our sustainability principles like Environmental protection, Social commitments and Governance Culture. We believe this will continue to make a big difference to trust, confidence, inclusion and effective stakeholder engagement. We continue with our virtuous employee experience and will strive for better employee engagement score in the upcoming time.


This report is based on the experience and information available to the Company in the pumps and valves business and assumption in regard to domestic and global economic conditions, government and regulation policies etc. The performance of the Company is dependent on these factors. It may be materially influenced by the changes therein beyond the Companys control, affecting the views expressed in or perceived from this report.


Key financial ratios of the Company showing financial performance are as under:

Ratios (Standalone) Year Ended 31st December, 2021 Year Ended 31st December, 2020
1. Debtors Turnover (days) 71 86
2. Inventory Turnover 104 110
3. Operating Profit Margin (%) 12.16 11.33
4. Net Profit Margin (%) 9.90 8.12
5. Return on Net Worth (%)* 16.19 11.96
6. Interest Coverage Ratio (%) 40.46 46.56

* Refer to Note 13(b)(i) of Notes to the standalone Financial Statements for details of increase in Return on Net Worth.


Rs. Million

Year ended 31st December, 2021 Year ended 31st December, 2020
Rs % Rs %
1. Raw Materials/Bought-out Components Consumed 7,924 51.66 6,205 50.03
2. Excise Duty (till 30th June, 2017) - - - -
3. Employee benefits expense 2,154 14.04 1,862 15.01
4. Other Expenses 2,800 18.26 2,336 18.83
5. Finance cost 50 0.33 34 0.27
6. Depreciation 436 2.84 418 3.37
7. Taxation
Current 561 3.66 422 3.40
Tax settlement relating to previous years - - 190 1.53
Deferred (54) (0.35) (36) (0.29)
8. Other Comprehensive (Income)/Expense (6) (0.04) 38 0.31
9. Dividend (including tax thereon) 296 1.93 278 2.24
10. Retained Earnings 1,176 7.67 657 5.30
TOTAL 15,337 100.00 12,404 100.00


Rs. Million


Year ended 31st December, 2021 Year ended 31st December, 2020
Non-Current Assets
1. Property, Plant and Equipment (including Capital Work in Progress and RoU assets) 3,485 3,421
2. Intangible Assets 13 14
3. Investments 63 63
4. Other Non-Current Assets (net) 106 (81)
5. Deferred Tax Assets (net) 220 168
Current Assets (Net) excluding borrowings- 5,754 5,479
TOTAL 9,641 9,064
1. Borrowings - 600
2. Net Worth* 9,641 8,464
TOTAL 9,641 9,064
*Represented by Equity Share
Equity Share Capital 348 348
Other equity 9,293 8,116
TOTAL 9,641 8,464
1. Revenue from operations 14,973 12,081
2. Other Income 364 323
TOTAL 15,337 12,404
1. Materials consumed 7,924 6,205
2. Excise Duty (till 30th June, 2017) - -
3. Employee benefits expense 2,154 1,862
4. Other expenses 2,800 2,336
5. Finance cost 50 34
6. Depreciation 436 418
7. Taxation
Current 561 422
Tax settlement relating to previous years - 190
Deferred (54) (36)
8. Other Comprehensive (Income)/Expense (net) (6) 38
7. Dividend (including tax thereon) 296 278
8. Retained Income 1,176 657
TOTAL 15,337 12,404


2021 2020 2019 2018 2017
EEquity Share Capital 348 348 348 348 348
Other Equity 9,293 8,116 7,459 6,784 6,277
Non-Current Liabilities 537 462 424 366 373
Non-Current Assets
Gross Block 7,805 7,482 7,184 6,615 6,152
Net Block 3,498 3,435 3,418 3,252 3,123
Investments 63 63 63 63 63
Other Non-Current Assets 643 381 408 520 629
Deferred Tax Assets (net) 220 168 119 161 176
Current Assets (Net) 5,754 4,879 4,223 3,502 3,007
Revenue from operations and Other Income 15,337 12,404 13,308 11,198 10,008
Gross Profit before
finance cost and depreciation 2,459 2,001 1,886 1,550 1,391
Finance cost 50 34 53 37 35
Depreciation 436 418 457 397 309
Profit before tax 1,973 1,549 1,376 1,116 1,047
Profit after tax 1,466 973 978 740 677
Dividend amount (including tax thereon) 296 278 251 243 230
Retained earnings 1,176 657 675 507 470
Return on Capital Employed % 20.98 17.46 17.00 15.24 16.03
Current Ratio 2.06 2.01 1.96 1.96 1.99
Earnings per share 42.12 27.96 28.10 21.27 19.45
Debt equity ratio 0.00 0.07 0.08 0.06 0.02
Book value per share 276.99 243.18 224.30 204.91 190.34
Dividend % 85 80 60 60 55
Fixed Assets Turnover 4.38 3.61 3.89 3.44 3.20
On behalf of the Board of Directors,
Kolkata, 24th February, 2022