Your observation about the imbalance in setting the targets is valid. The targets should be neither extremely stiff nor too easy to attain. The first principle of PMS is "KRAs should SMART" i.e. these should be Specific, Measurable, Attainable, Realistic and Time-bound.
However, execution of the first principle of PMS can be done by the seniors of the respective HODs. We the members of this forum are outsiders and we do not know anything about the conditions of work or work itself. Therefore, you may approach the Director or Managing Director of your company and put forth your observation. Let them review the targets set.
Secondly, what you have not mentioned is KRAs for the Managers themselves. Who sets their KRAs and what is their score? Going further, what are the KRAs for the departments? Are these assigned to the respective HODs? If yes, then have costs and ratios associated with each department been identified and assigned to the respective HOD?