SKF India (Industrial) Ltd

Financial Performance

• Revenue from operations was INR 9,708 million; YoY growth 18.3%.
• QoQ revenue growth: 2.6%.
• PBT was INR 869 million; margin 9.0–9.5%.
• Cash conversion reached 63.0% of the quarter's cash flow.

Operating Update

• Strong performance across segments: general machinery, wind, heavy, rail.
• Orders won: INR 140 crores (gearbox) and INR 35 crores (agri OEM).
• Pune line adds 3 million units annually for India/export.
• Tapered roller bearing line; supports agriculture, gearbox, aftermarket.
• Humanoid robots and data centers in India: early days.
• Capex for Pune plant: INR 850-900 crores; production starting 2028.
• Pune capacity aligns with both domestic and export demand.

Balance Sheet & Cash Flow

• Net working capital almost flat; operating cash flow solid.
• One-time outflow for name change and land transfer.
• One-time IT cost for demerger: ~INR 150 million; forex losses ~INR 147 million.

Capex & Projects

• Capex guidance: INR 850-900 crores for Pune plant.
• Pune plant to start production by 2028.
• Payback period expected at 5-7 years.
• Space constraints require a new factory; some channels moved from automotive.
• One additional TRB line by 2027; one more channel by early 2027.

Outlook & Guidance

• Path to 14-16% margins beyond 2028; near-term pressure from investments.
• Margins expected to improve from manufacturing efficiencies; Pune plant online 2028.
• Current margin around 9%; improvement possible through efficiency.

Q&A Highlights

• Innovation focus strongest in general machinery; some sectors slower to adopt.
• Humanoid robots in India: early stage; data centers demand modest, mainly pumps.
• Order book growth largely recurring; wind gearbox order is 1-year term; others longer-term.
• Tapered roller bearing line serves agriculture, gearbox, aftermarket.
• Solutions business share 6–7% today; potential to grow.
• Channel mix: distribution ~34%, OE ~54%.

Risks & Watchpoints

• Space constraints require a new factory; project timing uncertain.
• Demerger stabilization needed; IT and forex cost volatility.
• Near-term margin pressure from investments; long-term focus on efficiency.

Meeting Details

• Date and time: 14 August 2026, 11:00 IST.
• Type and mode: Analyst/Institutional Investor Meeting; mode not specified.
• Organiser: SKF India (Industrial) Limited.
• Purpose: Discuss Financial Results for Q1 ended 30 June 2026.
• Key company participant: Company Secretary & Compliance Officer.
• Recording: Audio recording available on the company website.

Business Overview

• Industrial segment manufactures bearings and related solutions in India.
• Q1 FY27 results reflect demerged Industrial undertaking performance.

Key Operational Highlights

• Operationalized TRB line, adding 3 million units annual capacity.
• Railway wheel-set bearings extend maintenance intervals by up to 20%.
• Energy-efficient hybrid bearings launched for next-generation electric drives.
• Localization investments strengthen competitiveness and reduce import exposure.

Financial Performance

• Revenue INR 9,708 MN; YoY 18.3%, QoQ 2.6%.
• PBT INR 869 MN; margin 9.0%; forex loss reduces margins 56 bps QoQ.
• Operating cash flow INR 547 MN; cash conversion 63%.
• Net working capital INR 6,275 MN; NWC 17.5% of revenue.

Strategic Priorities & Outlook

• Localization, innovation, and digitalisation to strengthen growth and profitability.
• Predictive, data-driven solutions and talent development emphasized.
• Industrial footprint expansion and faster delivery to boost competitiveness.

Risks & Mitigation

• Forex volatility impacting margins; mitigation via localisation and hedging strategies.

AGM details

• 2nd AGM held on 13 Aug 2026 at 15:00 IST via VC/OAVM; concluded 16:55 IST.
• Notice dated 12 May 2026 convened the AGM.
• Meeting hosted from registered office, Chinchwad, Pune.
• Quorum confirmed; meeting conducted under the Companies Act, 2013 and SS-2.
• Scrutinizer appointed for e-voting; cutoff date 06 Aug 2026.

Key resolutions

• Adopt Audited Standalone Financial Statements for FY ended 31 March 2026.
• Declare final dividend of INR 10 per equity share.
• Appoint Sujeeth Pai as Director, re-appointment by rotation.
• Appoint Secretarial Auditor for five years (J. B. Bhave & Co.).
• Approve Material Related Party Transactions with SKF GmbH, Schweinfurt (fellow subsidiary).
• Approve Material Related Party Transactions with SKF Engineering and Lubrication India Pvt Ltd.
• Approve Material Related Party Transactions with SKF Sverige AB.
• Approve Material Related Party Transactions with SKF AB Sweden (Ultimate Holding Company).
• Approve Material Related Party Transactions with SKF India Limited.
• Approve Material Related Party Transactions with SKF Asia Pacific Pte Ltd.
• Cost Auditors remuneration for FY2026-27 approved.
• Remuneration payable to Gopal Subramanyam (Independent Director) for FY2025-26 approved.

Dividend

• Final dividend approved: INR 10 per equity share.

Directors & management

• Sujeeth Pai re-appointed as Director.

Auditors

• Secretarial Auditor appointment for five years approved.

Related party transactions

• SKF GmbH, Schweinfurt: Material Related Party Transactions approved.
• SKF Engineering and Lubrication India Pvt Ltd: Material Related Party Transactions approved.
• SKF Sverige AB: Material Related Party Transactions approved.
• SKF AB Sweden: Material Related Party Transactions approved.
• SKF India Limited: Material Related Party Transactions approved.
• SKF Asia Pacific Pte Ltd: Material Related Party Transactions approved.

Leadership change

• Sujeeth Pai appointed Managing Director of SKF India (Industrial), effective September 1, 2026, subject to shareholder approval.
• Mukund Vasudevan to become President for the Industrial Region (India, Southeast Asia & Middle East).
• Appointment approved by Nomination Committee and Board on August 11, 2026.

Financial highlights

• Revenue from operations: Rs 9,707.7 million, up 18.3% YoY.
• Profit before tax: Rs 869.2 million, down 10.5% YoY.
• Profit after tax: Rs 619.2 million, down 13.8% YoY.
• PBT margin: 9.0%, down 288 bps YoY.
• QoQ revenue: Rs 9,457.2 million, up 2.6%.
• Growth across Wind, General Machinery and Agriculture sectors.
• FY2026-27 begins from a position of strength.
• Strategic focus on sustainable practices, localization and innovation.

Internal Auditor Appointment

• Ms. Anagha Godse appointed Internal Auditor with immediate effect from 11 August 2026 on Audit Committee recommendation.

Branch office opening

• Board approved opening of a branch office in Pimpri-Chinchwad, Pune, Maharashtra.
• Branch located at Millennium Towers, Unit-701, 7th floor, Tower 3, Wakad, 411057.
• Approval obtained at the board meeting held on 11 August 2026.

Interim dividend details

• Security: equity shares.
• Action: interim dividend declared.
• Dividend amount: ₹20 per share.
• Face value: ₹10 per share.
• Record date: 17 August 2026.
• Payment timing: not disclosed.
• FY 2026-27 entitlement.