Schaeffler IndiaQ1 FY27
Schaeffler India Q1 FY27 Earnings Call Analysis
Revenue, margin, capex, fundraise and order book outlook from management commentary.
Price: ₹4,001P/E: 48.6Market Cap: ₹62.8K CrSector: Auto Components
Management growth scorecard
Revenue
Category 3
Margin
Category 3
Fundraise
N/A
Order
Yes
Capex
Yes
2 of 4 growth signals are positive.
Full analysisRevenue guidance
Category 3- →Strong growth expected in core metal industrial sectors like steel, aluminium, and cement driven by infrastructure growth.
- →Industrial sector overall targeting double-digit growth; focus on improving distribution and aftermarket segments.
- →Power transmission sector showing about 8% growth with positive outlook.
- →Automotive sector currently sluggish due to commoditization and market challenges; efforts underway to improve via cost competitiveness and localization.
- →Exports have outperformed guidance with 24% growth, driven by intercompany allocations, localization, and favorable FX, with a target to cap exports at 20% of revenue.
- →Vehicle Lifetime Solutions and Bearings & Industrial Solutions show steady to moderate growth with new business wins.
- →Capacity expansions ongoing to meet OEM and aftermarket demand, aiming to support sustained double-digit growth.
- →Wind energy segment temporarily weak due to contract negotiations, expected to recover over time.
Margin guidance
Category 3- →EBITDA breakeven for KRSV (Koovers) expected by 2029.
- →Automotive Technologies revenue growing strongly at 33.3% YoY, driven by both conventional (+20%) and e-mobility segments.
- →Growth in automotive driven primarily by market share gains despite overall passenger vehicle production decline.
- →Bearings and Industrial Solutions aiming to return to double-digit growth, with strong order wins in key industrial sectors.
- →Export business showing 24% growth; intent to keep exports capped at 20% of revenues for natural hedging.
- →Industrial segment recovering, expected to achieve double-digit growth with focus on distribution and aftermarket expansion.
- →Capex for CY26 planned at INR 400-500 crores to support capacity expansion for sustaining growth.
- →Wage hikes and commodity cost pressures managed through productivity improvements; price corrections likely in H2 FY26.
- →Overall, the company anticipates sustained double-digit top-line growth with margin pressures easing as cost and pricing adjustments stabilize.
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Fundraise plans
The provided pages from the Schaeffler India Limited Q2 CY26 Earnings Conference Call transcript do not mention any current or future fundraising plans through debt or equity. Specifically:
- No references to raising capital via debt or equity were made.
- Discussion focused mainly on operational performance, capex plans, and working capital management.
- Capex for CY26 is expected to be INR 400-500 crores, funded through ongoing operations.
- Mention of maintaining free cash flow discipline but no fundraising activities indicated.
Hence, based on the available transcript content up to page 15, there are no announced or planned new fundraisings through debt or equity at this time.
Order book
Yes- →The company reports a solid order book for the year, supporting their growth momentum.
- →Large order wins occurred particularly in the industrial segment, contributing to business growth.
- →Automotive Technologies, Vehicle Lifetime Solutions, Bearings and Industrial Solutions, and exports have all secured new business opportunities.
- →New business wins in automotive include double clutch for tractors and compact overrunning alternator pulley.
- →Vehicle Lifetime Solutions expanded coverage with initiatives like REPXPERT vans.
- →Bearings and Industrial Solutions saw significant new order wins in products like cylindrical roller bearings, DGBBs, spherical rollers, and tri-plain bearings.
- →Despite some lag in certain sectors like wind energy and railways (tender-based), contract negotiations are ongoing.
- →Overall, the solid and growing order book underpins the company's double-digit growth ambitions.
Capex plans
Yes- →Capex for CY26 is pegged at INR 400-500 crores, with INR 175 crores spent in H1 and INR 250-300 crores expected in H2.
- →Orders have been placed for machinery for capacity expansion, including the Shoolagiri plant.
- →Close to INR 120 crores of capex is allocated for automotive, INR 170 crores for automotive technologies, and the remaining in Bearings & Industrial Solutions (B&IS).
- →Annual maintenance or sustaining capex is about 10% of total capex, considered very small.
- →Investments focus on expanding manufacturing capacities to sustain double-digit growth.
- →Capacity constraints at Hosur plant being addressed to meet both OEM and Vehicle Lifetime Solutions demands.
- →Localization efforts include building capacities at Savli for both local and export markets.
- →Strategic inventory build-up planned to manage evolving geopolitical and market demand situations.
How does Schaeffler India rank vs peers in Auto Components?
Pro feature1Schaeffler India
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