How has been the historical performance of Schaeffler India?

Revenue and Profit Growth

Over the three-year period ending December 2024, Schaeffler India’s net sales have shown a steady upward trajectory, increasing from ₹6,867.42 crores in December 2022 to ₹8,232.38 crores in December 2024. This represents a compound growth rate of approximately 9.7% annually, reflecting robust demand and effective market penetration. The total operating income mirrored this trend, as there was no other operating income reported during this period.

Operating profit before depreciation and interest (PBDIT) excluding other income rose from ₹1,294.39 crores in December 2022 to ₹1,445.36 crores in December 2024, indicating operational efficiency despite rising raw material and purchase costs. Including other income, operating profit increased to ₹1,563.66 crores by December 2024, up from ₹1,372.07 crores two years prior.

Profit before tax (PBT) also improved steadily, reaching ₹1,277.75 crores in December 2024 from ₹1,177.04 crores in December 2022. Correspondingly, profit after tax (PAT) rose from ₹879.21 crores to ₹938.86 crores over the same timeframe. Earnings per share (EPS) followed suit, increasing from ₹56.25 to ₹60.07, signalling enhanced shareholder value.

Cost Structure and Margins

The company’s raw material costs increased from ₹2,772.08 crores in December 2022 to ₹3,288.81 crores in December 2024, reflecting inflationary pressures and higher input prices. Purchase of finished goods fluctuated slightly but rose overall to ₹2,024.56 crores by December 2024. Employee costs also increased steadily, reaching ₹542.18 crores in the latest fiscal year.

Despite these rising costs, Schaeffler India maintained healthy operating margins. The operating profit margin excluding other income was 17.56% in December 2024, slightly down from 18.85% in December 2022, indicating some margin compression but still a strong profitability level. Gross profit margin similarly declined marginally from 20.15% to 18.94% over the period. The PAT margin stood at 11.4% in December 2024, down from 12.8% in December 2022, reflecting the impact of cost increases and taxation.

Balance Sheet Strength and Asset Base

Schaeffler India’s balance sheet has strengthened considerably, with shareholder’s funds rising from ₹4,285.90 crores in December 2022 to ₹5,334.43 crores in December 2024. Total reserves increased in tandem, reaching ₹5,303.17 crores. The company reported zero long-term and short-term borrowings throughout the period, highlighting a debt-free status which enhances financial stability and reduces risk.

On the asset side, net block (net fixed assets) expanded significantly from ₹1,019.64 crores to ₹1,871.64 crores, signalling ongoing capital investments and capacity expansion. Capital work in progress also increased, indicating active development projects. Current assets rose steadily to ₹4,253.71 crores by December 2024, supported by growing inventories and sundry debtors, while cash and bank balances remained robust at over ₹1,350 crores.

Cash Flow and Liquidity

Operating cash flow showed consistent improvement, increasing from ₹750 crores in December 2022 to ₹839 crores in December 2024, reflecting strong core business cash generation. Cash flow from investing activities was negative, primarily due to capital expenditure, but the outflow reduced significantly in the latest year. Financing activities saw net outflows, consistent with the company’s debt-free position and possible dividend payments or share buybacks.

Notably, the company’s closing cash and cash equivalents surged to ₹463 crores in December 2024 from ₹166 crores two years earlier, underscoring enhanced liquidity and financial flexibility.

Summary and Outlook

In summary, Schaeffler India has exhibited a solid historical performance marked by steady revenue growth, expanding profits, and a strong balance sheet free of debt. Margins have remained healthy despite cost pressures, and cash flow generation has improved, supporting ongoing investments and liquidity. The company’s rising book value per share, now above ₹340, reflects increasing net asset value and shareholder wealth accumulation.

While there has been some margin compression, the overall financial health and operational efficiency position Schaeffler India favourably for future growth opportunities in the automotive and industrial components sectors. Investors may consider these factors alongside market conditions when evaluating the company’s prospects.

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