Current Rating and Its Significance
On 01 October 2025, SKF India Ltd's rating was revised to 'Hold' from a previous 'Sell' rating, accompanied by a notable increase in its Mojo Score from 40 to 60 points. This 'Hold' rating suggests that the stock is expected to perform in line with the broader market, neither presenting a strong buy opportunity nor signalling a sell recommendation. For investors, this means a cautious approach is advisable, balancing potential gains against risks inherent in the stock's current fundamentals and market conditions.
Here’s How SKF India Ltd Looks Today
As of 20 January 2026, SKF India Ltd exhibits a mixed but stable profile across key investment parameters. The company operates within the Industrial Products sector and is classified as a small-cap stock. Its current Mojo Score of 60 reflects a moderate outlook, supported by strengths in quality and valuation, tempered by challenges in financial trends.
Quality Assessment
The quality grade for SKF India Ltd is classified as 'good'. This is underpinned by high management efficiency, demonstrated by a robust return on equity (ROE) of 21.98%. Such a figure indicates that the company is effective in generating profits from shareholders' equity, a positive sign for long-term investors. Additionally, the company maintains a low debt-to-equity ratio, averaging zero, which reduces financial risk and enhances balance sheet stability.
Valuation Perspective
Valuation is a standout strength for SKF India Ltd, graded as 'very attractive'. The stock trades at a price-to-book value of 3.3, which is considered a discount relative to its peers' historical valuations. This suggests that the market currently prices the stock conservatively, potentially offering value to investors seeking exposure to the industrial products sector. Despite this, the price appreciation over the past year has been significant, with the stock delivering a remarkable 107.53% return, far outpacing the BSE500 index's 6.92% gain over the same period.
Financial Trend Analysis
Financially, SKF India Ltd faces some headwinds, reflected in a 'negative' financial grade. The company’s operating profit has grown at a modest annual rate of 4.42% over the last five years, indicating limited long-term growth momentum. Recent results from September 2025 highlight some concerns, including the lowest operating cash flow for the year at ₹203.09 crores and a reduced return on capital employed (ROCE) of 27.18%. Furthermore, the debtors turnover ratio has declined to 5.31 times, signalling potential inefficiencies in receivables management. These factors suggest caution, as profitability and cash flow generation have shown signs of strain.
Technical Outlook
From a technical standpoint, the stock is rated as 'mildly bullish'. Short-term price movements show some volatility, with a one-day decline of 0.94% and a one-week drop of 3.45%. However, the stock has rebounded with a 3.67% gain over the past month and an impressive 77.26% increase over six months. The year-to-date performance is slightly negative at -2.22%, reflecting some recent market pressures. Overall, the technical indicators suggest cautious optimism, with the stock showing resilience despite intermittent pullbacks.
Institutional Confidence and Market Position
Institutional investors hold a significant 33.76% stake in SKF India Ltd, indicating confidence from well-resourced market participants who typically conduct thorough fundamental analysis. This level of institutional ownership often provides a stabilising influence on the stock price and can be a positive signal for retail investors. The company’s market-beating performance over the past year further reinforces its appeal, despite the mixed financial signals.
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What the Hold Rating Means for Investors
The 'Hold' rating for SKF India Ltd reflects a balanced view of the stock’s prospects. Investors should recognise that while the company demonstrates strong management quality and attractive valuation, the financial trends and recent operational challenges warrant caution. The rating suggests that the stock may not offer immediate strong upside but remains a viable option for those seeking exposure to the industrial products sector with moderate risk tolerance.
Investors are advised to monitor upcoming quarterly results closely, particularly focusing on operating cash flows and profitability metrics, to assess whether the company can overcome its recent financial setbacks. The technical mild bullishness indicates potential for gains, but volatility remains a factor to consider.
Summary of Key Metrics as of 20 January 2026
SKF India Ltd’s stock returns over various periods illustrate a volatile but generally positive trend: a 1-day decline of 0.94%, a 1-week drop of 3.45%, a 1-month gain of 3.67%, a 3-month loss of 18.28%, a 6-month surge of 77.26%, and a 1-year return of 107.53%. These figures highlight the stock’s capacity for strong recovery and growth despite short-term fluctuations.
The company’s financial health is marked by a high ROE of 21.98%, zero average debt-to-equity ratio, and a price-to-book value of 3.3, underscoring its valuation appeal. However, the negative financial grade and recent operational cash flow lows suggest that investors should remain vigilant.
In conclusion, SKF India Ltd’s 'Hold' rating by MarketsMOJO, last updated on 01 October 2025, is supported by a combination of solid quality and valuation metrics alongside cautionary financial trends and a mildly bullish technical outlook. This balanced assessment provides investors with a comprehensive understanding of the stock’s current standing as of 20 January 2026.
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