SKF India Q2FY27 sales rise 16% as EBITDA margin falls

SKF India reported Q2FY27 net sales of Rs 563.9 crore, up 16% year on year, as volume contributed 15.7 percentage points of growth while price and mix added 0.3 points; EBITDA margin fell 255 basis points sequentially to 14.5% from 17.1% in Q1FY27. Sales growth therefore exceeded the prior-year quarter, while quarterly profitability retreated from the preceding quarter.

How did SKF India achieve 16% sales growth in Q2FY27?

SKF India achieved 16% Q2FY27 sales growth through volume, with net sales rising to Rs 563.9 crore from Rs 486.1 crore in Q2FY26. The Rs 77.8 crore increase excludes other operating income, as do the sales figures in the company’s quarterly sales presentation. The executive summary rounds Q2FY27 sales to Rs 560 crore, while the detailed sales table reports Rs 563.9 crore.

Volume added Rs 76.1 crore, or 15.7%, to year-on-year sales growth, while price and mix added Rs 1.7 crore, or 0.3%. Volume therefore accounted for nearly all of the reported increase between Q2FY26 and Q2FY27. The presentation does not identify the products, customers or end markets responsible for the volume increase.

Sales were also higher sequentially, although the movement was smaller than the year-on-year rise. Q2FY27 net sales increased by Rs 12.8 crore from Rs 551.1 crore in Q1FY27, equivalent to 2% growth. Volume added Rs 22.6 crore, or 4.1%, but a Rs 9.8 crore price-and-mix reduction, or 1.8%, partly offset that contribution.

Why did SKF India’s EBITDA margin fall from Q1FY27?

SKF India’s EBITDA margin fell because reported EBITDA declined despite a sequential increase in sales. Earnings before interest, tax, depreciation and amortisation, or EBITDA, were Rs 86.5 crore in Q2FY27, compared with Rs 100.4 crore in Q1FY27. The resulting margin fell to 14.5% from 17.1%, a decline of 255 basis points.

The presentation reports the margin movement but does not provide a cost bridge for the sequential decline. Q2FY27 EBITDA was still Rs 22.2 crore higher than the Rs 64.3 crore reported in Q2FY26, and the margin was 155 basis points above the prior-year quarter’s 13.0%. The year-on-year comparison improved while the quarter-on-quarter comparison moved lower.

Profit before tax, or PBT, showed a similar sequential pattern. Q2FY27 PBT was Rs 69.8 crore, or 11.7% of revenue, versus Rs 83.8 crore, or 14.3%, in Q1FY27, producing a 252-basis-point margin decline. Q2FY27 PBT exceeded Q2FY26’s Rs 49.1 crore and 9.9% margin; the presentation marks the Q2FY26 PBT figure as excluding exceptional items.

What was SKF India’s Q2FY27 sales mix?

SKF India’s original-equipment, or OE, business was its largest reported revenue channel in Q2FY27 at 66% of sales. Value-added, or VA, business accounted for 19%, exports represented 10%, and SKF Industrial represented 5%. These revenue-mix figures exclude other operating income.

The mix changed against both comparison periods. OE was 67% in Q2FY26 and 61% in Q1FY27, placing its Q2FY27 share one percentage point below the prior-year quarter and five points above the preceding quarter. VA declined from 24% in Q2FY26 and 20% in Q1FY27 to 19%, while exports increased from 9% year on year and remained one point above Q1FY27.

SKF Industrial represented no reported sales share in Q2FY26, 10% in Q1FY27 and 5% in Q2FY27. The presentation does not say whether this movement reflected classification, project timing or demand. For H1FY27, OE represented 63% of sales, VA 20%, exports 9% and SKF Industrial 7%, compared with 67%, 25%, 8% and 0%, respectively, in H1FY26.

How did SKF India perform in H1FY27?

SKF India reported H1FY27 net sales of Rs 1,115.1 crore, up 19% from Rs 937.5 crore in H1FY26. The Rs 177.6 crore increase comprised a Rs 174.5 crore volume contribution and a Rs 3.1 crore price-and-mix contribution. As in the second quarter, the first-half increase was driven principally by volume.

First-half EBITDA increased to Rs 186.9 crore, or 15.8% of revenue, from Rs 143.1 crore and 14.9% in H1FY26. That represented a Rs 43.8 crore increase in EBITDA and an 87-basis-point increase in margin. H1FY27 PBT was Rs 153.6 crore, or 13.0% of revenue, compared with Rs 112.3 crore and 11.7% a year earlier; the executive summary presents the PBT percentage without exceptional items.

Net working capital, or NWC, was 18.8% of sales in Q2FY27, down 2.9 percentage points year on year and 3.8 points from Q1FY27. H1FY27 NWC was 18.7% of sales, also 2.9 percentage points below H1FY26. SKF India does not provide receivables, inventory or payables data in the presentation to explain the movement.

Conclusion

SKF India’s Q2FY27 results combined volume-led revenue growth with a sequential reduction in profitability. Volume contributed Rs 76.1 crore of the Rs 77.8 crore year-on-year sales increase, while EBITDA margin reached 14.5%, above Q2FY26’s 13.0% but below Q1FY27’s 17.1%. The H1FY27 figures retained year-on-year progress, with sales up 19% and EBITDA margin up 87 basis points to 15.8%.

The next results will show whether volume continues to offset the Q2FY27 price-and-mix decline of Rs 9.8 crore and whether EBITDA margin changes from 14.5%. SKF India also disclosed a passenger-vehicle manufacturer’s plan to introduce hybrid transmissions in upcoming models, where SKF India secured specified bearing-component shares, including 100% in deep-groove ball bearings, taper roller bearings and carbon-brush rings; the presentation gives no revenue value or timing for the programme.