Schaeffler India Adjusts Quality Grade Amid Strong Financial Performance and Growth Challenges

Schaeffler India, a midcap player in the auto components and equipment industry, has recently undergone an adjustment in its evaluation. The company's quality grade has been revised from excellent to good, reflecting a shift in its underlying financial metrics.
Over the past five years, Schaeffler India has demonstrated a sales growth rate of 12.64% and an EBIT growth rate of 8.21%. The company maintains a robust EBIT to interest ratio of 100.00, indicating strong earnings relative to its interest obligations. Additionally, Schaeffler India showcases a favorable debt profile, with net debt being notably low and a debt to EBITDA ratio that supports its financial stability.

The company's return on capital employed (ROCE) stands at 30.60%, while the return on equity (ROE) is recorded at 18.67%. These figures highlight the efficiency of management in generating returns. Furthermore, Schaeffler India has consistently reported positive results over the last three quarters, with net sales reaching Rs 2,434.65 crore in the latest quarter.

Despite these strengths, the company faces challenges with long-term growth, as indicated by its operating profit growth rate of 8.21% over the last five years.

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