Double-digit growth masked by margin pressure, VLS deceleration

Consolidated revenue ₹2,760 Cr (17.5% YoY standalone basis), EBITDA 18.5% but margin pressure from wage/input costs not recovered.

VLS grew 9.9% YoY, down sharply from 20%+ in prior years; management cites capacity constraints prioritizing OEMs.

Industrial Bearings & Solutions grew only 5% YoY; management defends as end-market issue (wind, railways), but market share not clearly proven stable.

Exports up 24% YoY and 28% in H1, driven by intercompany allocations and FX benefit; management now cautions uncertainty and wants cap at 20% of revenue share.

₹175 Cr spent in H1, targeting ₹250-300 Cr in H2 to meet ₹500 Cr upper limit; confirmed on track with orders placed.

VLS at 9.9% YoY in Q1 FY27 vs historic 20%+ runs; management pins to OEM prioritization over aftermarket due to capacity gap at Hosur.

Industrial Bearings grew only 5% vs management's aspiration for double-digit; wind energy contract lag and railway tender delays cited.

Not a growth target but a cap at 20% of revenue; H1 at 28% due to intercompany allocation and FX tailwind, but management says won't repeat.

Wage increases (10%) and input costs (LPG, fuel) will not be recovered quickly; OEMs expect productivity measures, with indexation hoped for in H2.

Core metal sectors performing well; power transmission +8% but wind energy contract delays and railway tender lag are temporary. Distribution/aftermarket business opportunity being pursued. Aspiration is double-digit but near-term tailwinds limited.

Primarily intercompany allocation (Savli capacity for group exports). FX also favorable (USD, not EUR). Never gave growth guidance, only cap at 20% of revenue for balance. Order book solid but geopolitical uncertainty means not revising guidance upward.

Capacity constraint, not demand. OEMs prioritized over VLS. Addressing supply chain development and Schaeffler capacity gap; will prioritize VLS parity with OEMs. Product portfolio expansion (INA range, REPXPERT revival) should help.

Wage hike (10%) not subject to recovery; OEMs expect productivity measures. FX indexation being worked on, expected in H2. Steel indexation also being negotiated. Air freight costs at Hosur plant from capacity constraint unlikely to be reimbursed.

Arm's-length pricing per OECD guidelines; transfer prices set quarterly, true-up at year-end in December. Cannot disclose segment-specific pricing.

Industrial non-mobility grew double-digit overall (including exports); automotive bearing business under pressure (commoditized). Distribution opportunity and new product portfolio to help. OEM side strong, aftermarket lagging.

Sales cutoff accounting adjustment (₹5.6 Cr) and founders' bonus provision (₹3 Cr) impacting Q2. Breakeven expected in 2029.

Market share gains (grew 3.6% vs market -8%). Conventional ICE business also up ~20%, e-mobility contributing remainder with timing variance. Strength across both.

Yes, expecting ₹250-300 Cr in H2 to reach ₹500 Cr. Breakup: ₹120 Cr automotive, ₹170 Cr automotive tech, rest in B&IS. Maintenance capex ~10% of total.

Intercompany allocation (Savli) driving 24% growth H1 but unsustainable; FX tailwind also temporary; management cautions on geopolitical uncertainty.

₹175 Cr spent H1, ₹250-300 Cr targeted H2, orders placed for machinery; on track for automotive tech, B&IS localization.

OEM discussions ongoing on LPG/propane; wage hikes expected to be offset by productivity, not direct pass-through; steel indexation also being negotiated.

Breakup: ₹120 Cr auto OEM, ₹170 Cr auto tech, rest B&IS; targeting double-digit growth sustainability; Shoolagiri plant in focus.

Industrial B&IS at 5% YoY growth, well below aspiration; management cites external headwinds (wind, railways) but also admits automotive bearing is commoditized with margin focus. Segment has been stuck at ₹400 Cr revenue for 6-8 quarters.

VLS growth halved to 9.9% from historic 20%+ runs. Management pins this to capacity constraints at Hosur plant prioritizing OEMs over aftermarket. Supply chain (local suppliers) also under development. Risk is that if OEM demand soften, VLS opportunity is structurally lost.

New Labor Code wage hikes (10% average) are not subject to OEM recovery; customers expect productivity measures. FX indexation being negotiated, hoped for in H2 but not guaranteed. Air freight from capacity constraints at Hosur unlikely to be reimbursed. Margin compression risk is real if negotiations stall.

Exports up 24% H1, but management explicitly cautions this is driven by intercompany allocation and FX tailwind; geopolitical uncertainty means they are 'treading carefully.' The 10-12% CY26 prior guidance is at risk; current 28% H1 rate is unsustainable. Rupee depreciation benefit also reversible.

KRSV (Koovers) is loss-making and won't reach EBITDA breakeven until 2029, 3 years away. Q2 margin worsened despite flat revenue due to sales cutoff adjustment (₹5.6 Cr) and founders' bonus accrual (₹3 Cr). Risk is prolonged cash burn and opportunity cost.