SKF India (Industrial) Limited – Investor Presentation Summary

Key Operational Highlights

  • Commissioned new mCRB (Medium Cylindrical Roller Bearing) manufacturing line at Ahmedabad factory
  • Added annual capacity of ~220,000 units
  • Supports growth across gearboxes, motors, railways, agriculture and aftermarket segments
  • Advanced automation and flexible manufacturing capabilities implemented

Key drivers of operational performance:

Localisation strategy execution, manufacturing capacity expansion, and advanced automation implementation

Financial Highlights

Revenue: ₹10,429 million

Profit before tax*: ₹1,344 million

PBT Margin: 12.9%

YoY comparison: Revenue increased 28.3% from ₹8,131 million in Q2 FY25-26, PBT increased 32.6% from ₹1,014 million in Q2 FY25-26

PBT Margin expanded 42 bps from 12.5% in Q2 FY25-26

Net working capital: ₹7,231 million (25.8% increase from ₹5,747 million in Q2 FY25-26)

NWC % of Revenue: 18.9% (increased 9 bps from 18.8% in Q2 FY25-26)

Operating cash flow: -₹61 million (compared to ₹2,175 million in Q2 FY25-26)

*after exceptional items

Drivers of financial performance:

Revenue growth across segments, improved operational efficiency

Geographical Revenue Split

Not Specified

Balance Sheet Snapshot

Not Specified

Capex & Cash Flow Health

Capital Expenditure: ₹800-950 crore investment planned through 2030 for manufacturing expansion and capability building

Operating Cash Flow: -₹61 million for Q2 FY2026-27

Pune manufacturing setup underway

Investment Rationale:

Focus on capacity expansion, localisation progression, and capability building

Strategic & R&D Initiatives

Innovation investments: SKF Solid oil bearing (lubrication-free solution for mining & construction applications), SKF DuraPro Carbo-Nitriding (enhanced load carrying capacity for tractor applications)

Digitalisation advancements to drive smarter, more efficient manufacturing and operations

Localisation strategy strengthening competitiveness

Expected impact on growth:

New manufacturing capacity supports growth across multiple industrial segments

Strategic Rationale:

Expanding local capabilities to improve agility and competitiveness, advancing energy-efficient & intelligent solutions for industry

Industry Trends & Business Environment

RBI forecast 7.1% GDP growth for FY27

Industrial output has strengthened, indicating improving manufacturing momentum

India's infrastructure momentum supports growth across core industries

Monsoon conditions have added pressure to fuel and food prices

Impact on Company:

Positioned to benefit from India's growth story and outgrow key segments such as Wind, Heavy industries, Aftermarket & Exports

Management Commentary & Growth Outlook

Strategic Outlook: "Strong First Year Post-Demerger - Revenue growth and healthy margins reflect our progress as a focused industrial business"

Market Position: "Well positioned to outgrow key segments such as Wind, Heavy industries, Aftermarket & Exports"

Competitive Advantage: "Driving customer value through localisation, innovation, digitalisation and operational excellence"

Cash Conversion: 19.5% for H1 FY2026-27

Key Contracts & Wins

Railways: ₹15 crore contract with large private player for complete drive system

Heavy Industries: Secured full bearing supply scope for steel project, enabling ₹5 crore+ in customer savings