SKF India (Industrial) Ltd — Q4 FY26 earnings call
Summary generated by AI from the official transcript SKF India (Industrial) Ltd filed with BSE on 19 May 2026. Every statement cites a verbatim quote from that document — open any citation to read it. This is a record of what management said, not a recommendation. How we check these summaries
The short read
SKF India (Industrial) Limited reported sequential sales growth of 9.8% to Rs 9.5 billion in Q4 FY26, driven primarily by OEM demand from wind, metals and rail customers, while profit before tax margin excluding one-time demerger-related expenses was 11.5% versus 13.1% in the prior quarter. Management attributed the margin decline to a shift in sales mix toward lower-margin OEM business and higher employee costs from full bonus accrual. Net working capital fell 2.8% quarter-on-quarter to 18.7% of sales, aided by inventory reduction.
Numbers mentioned
Sales growth: 9.8% (Q4 FY26 vs Q3 FY26)
p. 4
“We had a sales growth of 9.8% with INR 9.5 billion of sales.”
Mukund Vasudevan, page 4 of the filed PDF · View the filing
Profit before tax margin: 9.5% (Q4 FY26)
p. 4
“We had a 1,731 basis points improvement in our profit before tax, that's at 9.5%.”
Mukund Vasudevan, page 4 of the filed PDF · View the filing
Profit before tax margin excluding one-offs: 11.5% (Q4 FY26)
p. 4
“If we remove that, remove the impact of that, this quarter we delivered a margin of 11.5% -- or profit before tax of 11.5%.”
Mukund Vasudevan, page 4 of the filed PDF · View the filing
Net working capital reduction: 2.8% (Q4 FY26 vs Q3 FY26)
p. 4
“reduced our net working capital by 2.8% quarter-on-quarter and delivered 18.7% of sales net working capital.”
Mukund Vasudevan, page 4 of the filed PDF · View the filing
Demerger-related one-time expenses (previous quarter): around INR1.8 billion (Q3 FY26)
p. 4
“That was a total of around INR1.8 billion in the last quarter.”
Mukund Vasudevan, page 4 of the filed PDF · View the filing
Demerger-related one-time expenses (current quarter): INR 183 million (Q4 FY26)
p. 4
“In this quarter, we again had demerger-related IT costs, primarily that, totalling up to INR 183 million.”
Mukund Vasudevan, page 4 of the filed PDF · View the filing
Wind segment growth: 91.0% (Q4 FY26 vs Q3 FY26)
p. 5
“These OEMs specifically were wind, which grew 91.0% quarter-on-quarter, driven by orders from ZF and Suzlon, significant order deliveries.”
Mukund Vasudevan, page 5 of the filed PDF · View the filing
Rail segment growth: around 12.0% (Q4 FY26 vs Q3 FY26)
p. 5
“And then rail also grew around 12.0%.”
Mukund Vasudevan, page 5 of the filed PDF · View the filing
Inventory as % of sales: 16.9% to 16.0% (Q4 FY26)
p. 6
“You can see that the middle chart on the right-hand side shows an inventory reduction of 16.9% to 16.0%.”
Mukund Vasudevan, page 6 of the filed PDF · View the filing
FY26 distribution mix: around 35% (FY26)
p. 9
“So, if you look at full financial year, our distribution was at around 35% and OEM business was around 51%.”
Ashish Saraf, page 9 of the filed PDF · View the filing
FY26 OEM mix: around 51% (FY26)
p. 9
“our distribution was at around 35% and OEM business was around 51%.”
Ashish Saraf, page 9 of the filed PDF · View the filing
FY26 exports mix: around 6% (FY26)
p. 9
“Exports were at around 6% and sale to SKF India was at around 4% and other income was around 3%.”
Ashish Saraf, page 9 of the filed PDF · View the filing
Tractor company order value: almost 32.5 crores
p. 7
“We recently won an order of almost 32.5 crores with a tractor company, one of the largest tractor companies here.”
Mukund Vasudevan, page 7 of the filed PDF · View the filing
Tapered roller bearing capacity increase: from 600,000 pieces to 886,000 pieces
p. 8
“The net result of that was without too much expense, we increased capacity from 600,000 pieces to 886,000 pieces.”
Mukund Vasudevan, page 8 of the filed PDF · View the filing
Cost reduction from capacity enhancement: almost 18%
p. 8
“Cost was reduced by almost 18%.”
Mukund Vasudevan, page 8 of the filed PDF · View the filing
Increase in royalty and trademark expense: around INR 60-odd million (Q4 FY26)
p. 11
“We had we had to pay a royalty and trademark on our sales, on our higher sales to our group company. So that increased by around INR 60-odd million.”
Ashish Saraf, page 11 of the filed PDF · View the filing
What management said it would do
A record of statements made on the call, in the words management used. Parakho does not forecast, endorse or assess them, and their presence here is not a view on whether they will happen.
Profit before tax margin — around 13% · end of this calendar year
stated conditionally by Mukund Vasudevan
p. 9
“So given the recent demerger expenses, right, by we would say towards the end of this calendar year, we see that mostly normalizing. We should get back to a little more around 13%.”
Mukund Vasudevan, page 9 of the filed PDF · View the filing
Profit before tax margin — 15% range · by FY29-30
stated as an aspiration by Mukund Vasudevan
p. 9
“So, all that we think will get us by around by '29-'30, we believe we should be getting back to the 15% range. That's the goal.”
Mukund Vasudevan, page 9 of the filed PDF · View the filing
EBITDA margin ambition — 16% to 18% · up to 2030
stated as an aspiration by Mukund Vasudevan
p. 10
“So, our aspiration is to get to 16% to 18%, but right now up to 2030, both due to slightly higher OEM mix and a little higher depreciation charges, we see this, we have been”
Mukund Vasudevan, page 10 of the filed PDF · View the filing
Net working capital as % of sales — 19% to 20% of sales
stated conditionally by Mukund Vasudevan
p. 6
“Again, both those will normalize and the impact of inventory will probably drive this net working capital, which we expect in the range of 19% to 20% going forward, 19% to 20% of sales.”
Mukund Vasudevan, page 6 of the filed PDF · View the filing
Capex spend — around INR 800 crores plus · FY26 to FY29-30
stated firmly by Ashish Saraf
p. 12
“So, on capex, the overall plan for the between FY26, FY27 to FY29, FY30, we are looking at doing a capex spend of around INR 800 crores plus, which includes a significant chunk of investment on the new Pune plant which we are in the process of setting up.”
Ashish Saraf, page 12 of the filed PDF · View the filing
New Pune plant commissioning — commissioned · end of 2028
stated firmly by Ashish Saraf
p. 12
“Yes. So, we expect we expect the new Pune plant to be commissioned by end of 2028.”
Ashish Saraf, page 12 of the filed PDF · View the filing
Cost escalation pass-through — most of the FX and cost escalation impact
stated conditionally by Mukund Vasudevan
p. 10
“We are expecting to pass on most of it through price increases, some both the FX impact as well as the cost escalations.”
Mukund Vasudevan, page 10 of the filed PDF · View the filing
Revenue growth — around 8% · till 2028
stated conditionally by Mukund Vasudevan
p. 14
“So, the growth will continue to be in the range of I believe we have forecasted around 8%.”
Mukund Vasudevan, page 14 of the filed PDF · View the filing
Q&A highlights
Management's answers to analyst questions, in Parakho's words rather than a transcript. Each row names who answered and carries the verbatim quote it was drawn from.
CFO Ashish Saraf gave the full-year breakdown of distribution, OEM, exports and other income shares along with sub-segment OEM mix.
Answered by Ashish Saraf
Asked by Mumuksh Mandlesha: What is the segment-wise mix for FY26 across OEM, distribution, exports and other categories?
p. 9
“So, if you look at full financial year, our distribution was at around 35% and OEM business was around 51%.”
Ashish Saraf, page 9 of the filed PDF · View the filing
Management said FX depreciation and cost escalation of 3-4% are being passed through via price increases, more so with distributors than OEMs.
Answered by Mukund Vasudevan
Asked by Mumuksh Mandlesha: How is raw material cost inflation being managed and what price hikes have been taken?
p. 10
“The second is around escalating costs. The escalating costs we are projecting around 3% to 4%”
Mukund Vasudevan, page 10 of the filed PDF · View the filing
Management cited new Pune plant investment, competitive OEM pricing, and higher railway mix as reasons, and set a conservative near-term target of around 15% rather than 16-18%.
Answered by Mukund Vasudevan
Asked by Viraj: Why did other expenses rise sharply even after adjusting for demerger costs, and why is the long-term margin target lower than pre-demerger levels of 13-15%?
p. 10
“So, our aspiration is to get to 16% to 18%, but right now up to 2030, both due to slightly higher OEM mix and a little higher depreciation charges, we see this, we have been”
Mukund Vasudevan, page 10 of the filed PDF · View the filing
CFO confirmed commissioning by end of calendar year 2028.
Answered by Ashish Saraf
Asked by Viraj: When will the new Pune plant capacity be commissioned?
p. 12
“Yes. So, we expect we expect the new Pune plant to be commissioned by end of 2028.”
Ashish Saraf, page 12 of the filed PDF · View the filing
Management said the wind growth is primarily driven by the domestic Indian market, with ZF having some export exposure though only partially served by SKF India.
Answered by Mukund Vasudevan
Asked by Krupashankar NJ: What is driving the wind segment growth and is it domestic or export-focused?
p. 12
“Wind is primarily India, actually. India is now the fastest growing wind market.”
Mukund Vasudevan, page 12 of the filed PDF · View the filing
Management clarified the investment is for plant and machinery (DGBB and TRB channels) at the new Pune facility, and that interim growth of around 8% will be supported by job work from SKF India and sourcing from other SKF global factories.
Answered by Ashish Saraf
Asked by Yash: What is the planned INR 350-400 crore channel expansion investment for, and how will growth continue until the new plant is operational?
p. 14
“So, plant and machinery, plant and machinery, basically to add more capacity.”
Ashish Saraf, page 14 of the filed PDF · View the filing
Risks flagged
FX depreciation increasing cost of imported components
p. 9
“One is the bigger one actually is FX. So, anything we are importing, right, and selling, there is an FX impact with the rupee depreciating.”
Mukund Vasudevan, page 9 of the filed PDF · View the filing
Raw material and input cost escalation from oil and steel prices
p. 10
“And that involves some assumptions what we are seeing in oil prices right now, but it also involves some assumptions in steel prices going up.”
Mukund Vasudevan, page 10 of the filed PDF · View the filing
Intense competition in OEM segment pressuring margins
p. 10
“So, while as the especially at the OEMs, I think the competition is intense.”
Mukund Vasudevan, page 10 of the filed PDF · View the filing
Lower margin from higher OEM sales mix compared to distribution business
p. 6
“Our OEM business grew significantly and as a result, the mix of lower margin OEM business compared to higher margin distribution business accounted for most of this drop.”
Mukund Vasudevan, page 6 of the filed PDF · View the filing
Difficulty passing on full cost escalations to OEM customers due to tougher negotiations
p. 10
“Obviously, with OEMs, it might be it's a little tougher, those are tougher negotiations.”
Mukund Vasudevan, page 10 of the filed PDF · View the filing
Generated by claude-sonnet-5. Source: the transcript as filed with BSE. We link to the exchange's copy; we do not host transcripts. Parakho is a data and screening tool, not an investment adviser — nothing here is a recommendation to buy, sell or hold.