India · Delayed Price · Currency is INR SKF India Earnings Call Transcripts
Fiscal Year 2026
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Q1 FY2026 saw 6% sales growth, led by Industrial at 13%, while Automotive was flat and margins fell 530 bps due to demerger and FX costs. Demerger is on track, with capacity expansions and service business growth expected to drive future gains.
Fiscal Year 2025
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Shareholders approved a demerger to create two focused companies, with each shareholder receiving equivalent shares in the new entity. Management addressed questions on costs, employee allocation, CapEx, and future strategy, emphasizing growth, localization, and market alignment.
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Q4 saw muted 1% sales growth but a sharp margin boost from transfer pricing adjustments, while full-year sales rose 8% with strong industrial and automotive performance. CapEx will double for new capacity, and the demerger process is on track for completion by year-end.
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The demerger will create two focused entities, automotive and industrial, each targeting distinct market drivers and customer needs. Both are expected to maintain strong financial performance, with continued investment and operational improvements, and the process is on track for completion by end of FY25.
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Separation of automotive and industrial businesses aims to unlock value and improve focus. Q3 saw 15% revenue growth, but gross margins contracted due to higher traded product costs; margins are expected to recover as cost rationalization continues. Industrial segment led growth, driven by strong volume gains.
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Q1 FY 2024-25 saw net sales of INR 11.8 billion, with a higher manufacturing mix and stable margins. Growth is expected to accelerate as wind and rail recover, with continued focus on localization, capacity expansion, and profitable growth.