SKF India 's stock saw a significant upturn, breaking a 10-day losing streak with a 5% gain. This rebound comes amidst increased interest from mutual funds, which have been actively building their positions in the auto ancillary company.

Mutual Fund Activity

Several major mutual funds have shown strong confidence in SKF India by substantially increasing their exposure:

This surge in mutual fund interest has led to a notable increase in the company's mutual fund ownership, which now stands at 23.83%.

Analyst Sentiment

The stock is also garnering attention from market analysts. Current coverage of SKF India reveals a generally positive outlook:

This distribution suggests a cautiously optimistic view among analysts regarding SKF India's prospects.

Market Implications

The renewed interest from institutional investors, particularly mutual funds, may signal confidence in SKF India's fundamentals and growth potential. The breaking of the 10-day decline could potentially mark a turning point for the stock, although investors should always consider market volatility and conduct thorough research before making investment decisions.

As the auto ancillary sector continues to evolve, SKF India's performance will likely be closely watched by both institutional and retail investors. The increased mutual fund ownership could potentially provide some stability to the stock, but as always, market conditions and company performance will be key factors in determining future stock movements.

SKF India Limited , a leading manufacturer of bearings and related products, has announced the completion of its Industrial Undertaking demerger and released its financial results for the second quarter ended September 30, 2025. The company's board approved the unaudited financial results, which included exceptional demerger expenses related to the separation of its Industrial Undertaking.

Demerger Completion and Restructuring

SKF India has successfully completed the demerger scheme with National Company Law Tribunal (NCLT) approval. The Industrial Undertaking has been transferred to SKF India (Industrial) Limited, with an effective date of October 1, 2025. This strategic move restructures the company's operations, potentially allowing for more focused growth in both the separated units.

Financial Performance

The company's Q2 2025 results reflect the impact of the demerger process:

The company reported exceptional demerger expenses of ₹257.40 crore related to the separation of its Industrial Undertaking. These expenses significantly impacted the company's profitability metrics for the quarter.

Key Observations

1. Revenue Growth: Despite the ongoing restructuring, SKF India managed to increase its revenue by 5.87% quarter-over-quarter, indicating resilient demand for its products.

2. Profitability Impact: The exceptional demerger expenses led to a substantial decline in profitability metrics. EBITDA, operating profit, and net profit all saw significant decreases compared to the previous quarter.

3. Operating Profit Margin: The OPM for Q2 2025 stood at 13.04%, down from 23.45% in the previous quarter, reflecting the impact of the demerger expenses and potential operational adjustments during the transition.

4. Sales Performance: The company's sales grew by 5.75% compared to the previous quarter, aligning closely with the overall revenue growth.

Looking Ahead

The completion of the demerger marks a significant milestone for SKF India. As the company moves forward with its restructured operations, investors and analysts will be keen to observe how this strategic move impacts its future performance and market positioning.

The separation of the Industrial Undertaking into SKF India (Industrial) Limited may allow for more specialized focus and potentially improved operational efficiencies in both entities. However, the full impact of this restructuring on the company's long-term financial performance and market competitiveness remains to be seen in the coming quarters.

Investors should note that while the exceptional expenses related to the demerger have impacted the current quarter's profitability, these are one-time costs associated with the restructuring process. Future quarters may provide a clearer picture of the company's performance under its new structure, free from these exceptional items.

As SKF India navigates this transition, stakeholders will be watching closely for signs of how the company leverages this new structure to drive growth and enhance shareholder value in the evolving industrial landscape.