SKF India Ltd is a leading supplier of products, solutions & services within rolling bearing, seals, mechatronics, and lubrication systems.
Q2 FY26 Earnings Results
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Revenue from Operations: ₹1,309.06 crore, up 2.02% QoQ and 5.21% YoY, marking the highest quarterly revenue on record for SKF India.
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Net Profit (PAT): ₹105.49 crore, up 11.99% YoY but down 10.76% QoQ due to margin pressures.
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Profit Before Tax (PBT): ₹140.62 crore, up 10.89% YoY.
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Operating Margin contracted to 12.66% from 13.04% QoQ, and sharply down from 23.45% in Q4 FY25 due to cost pressures including raw materials and employee expenses, which rose 20.53% and 19.96% YoY respectively.
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Cash flow concerns noted with operating cash flow dropping sharply in FY25 to ₹203 crore from ₹624 crore in FY24.
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Debtors turnover ratio declined, indicating longer collection cycles and stretched credit terms.
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Management approved demerger plan for industrial unit to unlock value and improve agility.
Management Commentary & Strategic Insights
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Management expressed confidence in revenue growth despite margin headwinds, attributing margin pressure primarily to global raw material inflation and rising employee costs.
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Emphasis on reversing margin compression through cost controls, operational efficiencies, and leveraging the demerger to create focused business units.
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Long-term strategy revolves around capitalizing on industrial capex recovery and automotive sector momentum for growth acceleration.
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Operating cash flow improvement and sustainable margin recovery remain key focus areas to assure earnings quality and investor confidence.
Q1 FY26 Earnings Results
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Revenue from Operations: ₹1,283.15 crore, an increase of 6.38% YoY.
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Profit After Tax (PAT): ₹118.21 crore, down 25.62% YoY due to margin contraction.
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Operating margin stood at 13.04% in Q1 FY26, indicating better margin situation than Q2 FY26.
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Higher material costs and employee expenses impacted profits despite improved revenues.
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The company reported consistent revenue growth amid challenging industrial conditions.
To view the company’s previous earnings and latest concall transcripts, click here to visit the Alphastreet India news channel.