SKF India rises 6% as Board okays demerger of auto, industrial businesses

SKF India shares gained 6.2 per cent in trade on Wednesday and logged an intraday high of Rs 5,500 per share. The buying interest in the stock was sparked after the company's board gave nod to the demerger of its industrial and automotive business.

At around 11:28 AM, SKF India shares quoted 3.3 per cent higher at Rs 5345.2 per share. In comparison, the BSE Sensex traded 0.78 per cent higher at 82,272.59 around the same time.

"The board has granted its in-principle approval to segregate the automotive and industrial business through a scheme of arrangement," the filing read. 

For a detailed scheme of the demerger, the board has authorised the corporate restructuring committee to take preparatory steps. 

As per the demerger proposal, the authorised capital of its industrial business, which will be its new wholly owned subsidiary, is likely at Rs 15 lakh which will be divided into 1,50,000 shares of Rs 10 each. 

SKF India will hold 100 per cent of issued and subscribed share capital of its industrial business.

In a filing dated September 17, SKF India's parent AB SKF announced its decision to initiate the separation of its automotive business globally.

The objective of the demerger is to separately list its auto business on Nasdaq Stockholm through a Lex Asea distribution during the first half of 2026.

As per the filing, SKF's automotive business separation will facilitate a clearer focus on distinct opportunities to enhance customer value, accelerate growth as well as improve efficiency and competitiveness. 

Further, demerger would increase automotive’s ability to adapt faster to transforming global automotive markets, by allowing it to make independent business decisions and investments. 

Meanwhile, as per the company, a more focused industrial company will be even better equipped to develop and execute its strategy and allocation of resources. The demerger will help in properly fulfilling industrial customers’ needs, accelerate growth, improve efficiency, increase responsiveness, and enhance end-user experiences. 

SKF provides automotive and industrial-engineered solutions through its five technology-centric platforms: bearings and units, seals, lubrication, condition monitoring, and maintenance services. 

In the past one year, SKF India shares have lost 2.2 per cent against Sensex's rise of 25 per cent.