SKF India may face pressure on revenues and margins amid weak demand

Trading at 30x its FY21 earnings, there is limited upside

The SKF India stock has shed over 16 per cent over the last month and a half, hit by a weak near-term outlook on its key segments, industrial and auto products. The subsidiary of Sweden’s AB SKF Group, the global bearings major, could face pressure on revenues and margins, given the sluggish demand environment.

In the December quarter (Q3), the firm reported an 8 per cent fall in revenues. This was driven by the auto segment that fell an estimated 20 per cent, along with weakness in most of its sub-segments. Auto is the second-largest segment, accounting for about 38