Schaeffler India Ltd Q1 FY26 – Sales ₹2,282 Cr, PAT ₹296 Cr, EPS ₹18.95. P/E 61: Bearings So Expensive, They Could Be Sold at Tanishq.
1. At a Glance
Schaeffler India, the desi arm of the German ball-bearing aristocrats, just delivered Q1 FY26 with ₹2,282 Cr sales (up 10.1% YoY) and PAT of ₹296 Cr (up 16.8% YoY). Margins are strong, debt is negligible, and P/E is insane at 61×. Basically, it’s like buying a Maruti 800 at BMW rates—except here the German brand stamp makes you feel classy.
2. Introduction
Every detective has that one rich suspect in a murder mystery. The guy in the Armani suit, sipping vintage Scotch, with alibis so clean even the judge feels guilty. That’s Schaeffler India for the auto components sector.
For 70+ years, they’ve been supplying precision bearings, clutches, transmissions, and now EV hybrid systems. They merged their Indian cousins INA Bearings and Luk India back in 2018 (family reunion, German style—complete with bratwurst and balance sheets).
Today, they’re everywhere—cars, tractors, railways, industrial robots. Basically, if something rotates in India (except politicians), chances are Schaeffler has a bearing in it.
But here’s the riddle: how does a company growing at 12% annually deserve a 61× P/E? Either investors believe India will run only on Schaeffler parts by 2030, or we’re all paying a German luxury tax for desi bearings.
So let’s pull out the magnifying glass.
3. Business Model – WTF Do They Even Do?
Schaeffler India has four neat boxes:
Automotive Technologies (41% revenue): Clutches, transmission systems, hybrid & electrified drive systems. If your car moves forward without falling apart, thank Schaeffler.
Industrial (37%): Bearings for railways, automation, 2-wheelers, power transmission. Fancy words for “they make round things spin smoothly.”
Automotive Aftermarket (10%): Replacement parts sold with “original quality” tags so garages don’t scam you with Chinese fakes.
Special Machinery (~2% but cool): In-house unit making custom machinery. Think German engineers designing robots to build more bearings—self-sufficiency goals.
Basically, they sell rotating karma. Your scooter’s wheel? Schaeffler. Your train’s axle? Schaeffler. Your neighbour’s tractor clutch? Also Schaeffler. It’s like God—omnipresent, invisible, and expensive.
Question for you: would you pay ₹4,100 a share just to own a piece of the company making the part that makes your Swiggy delivery boy’s bike run smoother?
4. Financials Overview
Source table
Metric
Latest Qtr (Q1 FY26)
YoY Qtr (Q1 FY25)
Prev Qtr (Q4 FY25)
YoY %
QoQ %
Revenue
2,282
2,072
2,110
10.1%
8.1%
EBITDA
431
380
401
13.4%
7.5%
PAT
296
254
265
16.8%
11.7%
EPS (₹)
18.95
16.22
16.98
16.8%
11.6%
Commentary: Growth is clean, margins intact, QoQ jump looks healthy. Annualised EPS = ₹76. At CMP ₹4,110 → P/E ~54×. So even if they grow earnings 20% for 5 years, you’re still paying ahead of time like Indian parents paying 10 years of tuition fees at birth.
5. Valuation Discussion – Fair Value Range
Let’s run the detective’s calculator:
P/E method: EPS annualised ~₹76. Industry average P/E = 29. Schaeffler trades at 54–61. → Range = 35×–50× = ₹2,660–₹3,800.
EV/EBITDA method: TTM EBITDA ~₹1,585 Cr. EV ~₹62,878 Cr. EV/EBITDA = 39.6. Industry 20–25. → Fair EV = 20×1,585 to 25×1,585 = ₹31,700–₹39,600 Cr. Per share = ₹2,000–₹2,540.
