SKF India Limited Earnings Summary — Q2 FY2026
SKF India Reports Q2 Growth Amid Major Industrial Demerger Announcement
Quarterly Business Intelligence
AI Quarterly Scorecard™
Computed deterministically from the last 10 reported quarters.
Quarterly Business Momentum
- Revenue declined 1.1% sequentially in Q1 FY2027.
- Revenue of ₹588 Cr is 54.2% lower year-on-year.
- Revenue has compounded at -27.3% annualised over the last 10 quarters.
- Net profit of ₹62 Cr is 47.6% below the same quarter last year.
- Profit growth is outpacing revenue growth, pointing to positive operating leverage.
- Net profit has compounded at -40.6% annualised across the period.
- Operating margin stands at 15.0% in Q1 FY2027.
- Operating margin expanded by 193 bps year-on-year.
- Over the last two years operating margin has contracted by 108 bps.
- PBT margin is 14.3%.
- Expense growth of -55.2% remained below revenue growth of -54.2%.
- Operating profit of ₹88 Cr is 47.4% lower year-on-year.
- Operating leverage has been under pressure recently.
- 3 of the last 6 measured quarters delivered year-on-year revenue growth.
- Overall quarterly business momentum scores 43/100 (Moderate) on the latest 10 quarters.
- Business momentum has softened and warrants monitoring.
Quarterly Financials
Last 10 Reported Quarters • All figures in ₹ Crore • Margins in %
| Metric | Trend | Latest Q1 FY2027 | Q4 FY2026 | Q3 FY2026 | Q2 FY2026 | Q1 FY2026 | Q4 FY2025 | Q3 FY2025 | Q2 FY2025 | Q1 FY2025 | Q4 FY2024 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | Softening | 588 | 595 | 577 | 1,309 | 1,283 | 1,213 | 1,256 | 1,244 | 1,206 | 1,203 |
| Expenses | Softening | 500 | 561 | 494 | 1,143 | 1,116 | 929 | 1,135 | 1,121 | 1,013 | 990 |
| Operating Profit | Volatile | 88 | 33 | 82 | 166 | 167 | 285 | 121 | 124 | 194 | 213 |
| Operating Margin | Volatile | 15.0% | 5.6% | 14.3% | 12.7% | 13.0% | 23.4% | 9.6% | 9.9% | 16.1% | 17.7% |
| Other Income | Volatile | 12 | 29 | 20 | -2 | 15 | 13 | 48 | 23 | 40 | 35 |
| Interest | Declining | 0 | — | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Depreciation | Stable | 17 | 16 | 16 | 23 | 23 | 22 | 21 | 20 | 20 | 19 |
| Profit Before Tax | Volatile | 84 | 47 | 86 | 141 | 160 | 276 | 147 | 127 | 214 | 230 |
| Tax | Volatile | 22 | 66 | 24 | 35 | 42 | 72 | 38 | 33 | 55 | 54 |
| Net Profit | Volatile | 62 | -20 | 62 | 105 | 118 | 203 | 110 | 94 | 159 | 175 |
| Net Margin | Volatile | 10.5% | -3.3% | 10.8% | 8.1% | 9.2% | 16.8% | 8.7% | 7.6% | 13.2% | 14.6% |
Key Takeaways
- Consolidated revenue for Q2 grew 5.2% YoY to ₹13,090.6 million, demonstrating steady demand across segments.
- The Board approved a major Scheme of Arrangement for the demerger of the Industrial Undertaking into SKF India (Industrial) Limited.
- The demerger has an effective date of October 1, 2025, leading to the classification of industrial assets as 'Held for Sale' as of September 30, 2025.
- Exceptional costs of ₹257.4 million were incurred during the quarter related to IT, professional services, and employee benefits for the demerger process.
- Standalone results highlight that the discontinued industrial operations contributed ₹769.3 million to the net profit during the quarter.
- Cash and cash equivalents remain strong at ₹7,949.7 million on a consolidated basis, despite the restructuring activities.
Management Guidance
The company is transitioning its corporate structure to focus on 'Intelligent and Clean' growth, with the demerger expected to unlock long-term value for the industrial and automotive businesses separately. Following the scheme implementation, the resulting industrial company ceased to be a subsidiary effective October 1, 2025.
Sentiment Shift
Improving
Revenue and net profit showed resilience YoY despite the complexities and one-time costs associated with the significant demerger of the industrial business.
Outlook
The outlook is centered on the successful execution of the demerger to streamline operations. Management continues to prioritize localized manufacturing and EV solutions as core growth pillars for the remaining automotive-focused entity.
From the Annual Report (Key Quotes)
“The Scheme, among other provisions, entails the demerger of the Industrial Undertaking from the Demerged Company into the Resulting Company on a going concern basis.”
“The Company has incurred certain demerger expense... aggregating to INR 257.4 Million... these restructuring costs are non-recurring in nature.”
“Following the implementation of the Scheme, the Resulting Company has ceased to be a subsidiary of the Company with effect from October 01, 2025.”
Official Quarterly Documents
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This summary is AI-generated from SKF India Limited's latest quarterly filing and earnings call. For informational purposes only — not investment advice.