1. At a Glance
SKF India runs like a finely-lubricated bearing—quiet, efficient, and insanely profitable. With a legendary Swedish parent, a juicy ROCE of ~29%, and a P/E of 43x, it’s the kind of capital goods play that rolls smoother than your boss dodging work.
2. Introduction with Hook
Imagine a ballerina in steel-toed boots—delicate precision meets industrial toughness. That’s SKF India.
- FY25 Revenue: ₹4,920 Cr
- FY25 PAT: ₹566 Cr
- ROCE: 29%
- Debt: Basically extinct
- Upcoming demerger of industrial biz = spinoff drama incoming
SKF doesn’t shout. It just quietly outperforms.
3. Business Model (WTF Do They Even Do?)
SKF India makes bearings, seals, lubrication systems, and mechatronics components. If it rotates, SKF probably had something to do with it.
Major segments:
- Automotive OEMs & Aftermarket
- Industrial OEMs (textile, steel, energy, railways)
- Services (maintenance, condition monitoring, asset management)
They also offer predictive maintenance via AI/IoT—because even ball bearings want to be smart now.
4. Financials Overview
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue (₹ Cr) | 4,305 | 4,570 | 4,920 |
| EBITDA (₹ Cr) | 749 | 718 | 745 |
| Net Profit (₹ Cr) | 525 | 552 | 566 |
| OPM (%) | 17% | 16% | 15% |
| ROCE (%) | 34% | 29% | 29% |
| ROE (%) | 23% | 22% | 21% |
Even with high base and global slowdown, margins remain tight as a new bearing seal.
5. Valuation
| Metric | Value |
|---|---|
| CMP | ₹4,873 |
| Market Cap | ₹24,114 Cr |
| EPS (FY25) | ₹114.45 |
| P/E | 42.6x |
| Book Value | ₹526 |
| P/B | 9.27x |
| Dividend Yield | 0.3% |
Fair Value Range = ₹3,600 – ₹4,300 (based on 30–37x FY25 EPS)
Premium pricing for a high-quality, capital-efficient MNC, but not invincible.
6. What’s Cooking – News, Triggers, Drama
- Biggest Trigger: Industrial business demerger. NCLT approved; restructuring underway.
- SKF India (Industrial) Ltd formed as a separate entity.
- Automotive segment likely to see separate listing or operational shift.
- Recent MD changes: Manish Bhatnagar out, Mukund Vasudevan in.
- Focus on automation, smart factories, and predictive maintenance solutions.
Basically: SKF wants to stop being just a bearing company and start being a platform play.
7. Balance Sheet
| Item | FY25 |
|---|---|
| Equity Capital | ₹49 Cr |
| Reserves | ₹2,549 Cr |
| Borrowings | ₹7 Cr |
| Total Liabilities | ₹3,564 Cr |
| Fixed Assets | ₹551 Cr |
| CWIP | ₹56 Cr |
| Other Assets | ₹2,948 Cr |
Key Point: Negligible debt, strong reserves. Balance sheet tighter than a press-fit roller.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY23 | ₹690 Cr | -₹45 Cr | -₹79 Cr | ₹567 Cr |
| FY24 | ₹624 Cr | -₹158 Cr | -₹204 Cr | ₹262 Cr |
| FY25 | ₹203 Cr | -₹60 Cr | -₹650 Cr | -₹507 Cr |
FY25 saw huge payout/capital shuffle—likely pre-demerger moves. But operations still solid.
9. Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| ROCE | 29% |
| ROE | 21.4% |
| OPM | 15% |
| D/E | ~0.002x |
| Interest Cover | 700x |
| P/E | 42.6x |
| P/B | 9.27x |
Sexy. Like James Bond in coveralls.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | EBITDA | Net Profit | EPS | OPM % | PAT % |
|---|---|---|---|---|---|---|
| FY23 | ₹4,305 Cr | ₹749 Cr | ₹525 Cr | ₹106.15 | 17% | 12.2% |
| FY24 | ₹4,570 Cr | ₹718 Cr | ₹552 Cr | ₹111.61 | 16% | 12.1% |
| FY25 | ₹4,920 Cr | ₹745 Cr | ₹566 Cr | ₹114.45 | 15% | 11.5% |
Margins slightly compressing, but still elite-tier for manufacturing.
11. Peer Comparison
| Company | P/E | ROE | OPM | Sales (₹ Cr) | PAT (₹ Cr) | Mcap (₹ Cr) |
|---|---|---|---|---|---|---|
| Timken India | 56.7x | 17% | 18.7% | ₹3,148 Cr | ₹447 Cr | ₹25,406 Cr |
| SKF India | 42.6x | 21.4% | 15% | ₹4,920 Cr | ₹566 Cr | ₹24,114 Cr |
| Grindwell Norton | 55.5x | 16% | 18.3% | ₹2,812 Cr | ₹345 Cr | ₹19,186 Cr |
| CUMI | 52.4x | 10.8% | 14.5% | ₹4,894 Cr | ₹358 Cr | ₹18,755 Cr |
| Wendt India | 66.1x | 15.1% | 22.7% | ₹234 Cr | ₹34 Cr | ₹2,278 Cr |
SKF: Lower P/E than peers, higher ROE. Big fish, bigger moat.
12. Miscellaneous – Shareholding, Promoters
| Category | % Holding (Mar 2025) |
|---|---|
| Promoters | 52.58% |
| FIIs | 8.21% |
| DIIs | 26.51% |
| Public | 12.68% |
| Shareholders | 66,264 |
Stable promoter holding. FII & DII love consistent. Retailers waking up slowly.
13. EduInvesting Verdict™
SKF India is the Jeff Bezos of bearings—silent, relentless, and always reinventing itself. The upcoming demerger could unlock serious value, creating focused plays on industrial and auto segments.
Is it expensive? Sure.
Is it efficient? Heck yes.
Is it boring? Absolutely not.
Verdict: SKF isn’t spinning its wheels—it’s gearing up for something big. Grab the popcorn (and your calculator).
Metadata
– Written by EduInvesting Team | 15 July 2025
– Tags: SKF India, Bearings Market, Capital Goods MNC, Demerger Watch, Swedish Companies, Industrial Products, High ROCE Stocks
