Q1 2027 Timken India Ltd Earnings Call Transcript
Key Points
- Timken India Ltd (BOM:522113) reported a 15% year-on-year revenue growth in Q1 FY2027, reaching INR929 crore, driven by resilient demand in core segments and strong execution in both domestic and export markets.
- The company achieved a 15% bottom-line growth with PBT at INR150 crore, and the PBT margin improved to 16.2% despite higher depreciation from new capacity investments, indicating operational efficiency.
- The Bharuch plant is ramping up rapidly, with utilization for spherical roller bearings expected to reach 70% by August-September 2026, and the plant is producing top-quality products at record speed.
- The company secured BIS certification for CRB and CRB rollers and TRB rollers during the quarter, reinforcing its commitment to quality standards for the domestic market.
- The proposed amalgamation of Timken GGB Technology Private Limited with Timken India Ltd (BOM:522113) is progressing, with NCLT approval pending, which is expected to drive synergies, efficiencies, and cost reductions.
- The process segment grew nearly 30% year-on-year, driven by strong demand from wind energy and metal customers, while exports to the US market are robust, supported by resilient American demand.
- The railway segment experienced sluggish growth of only 3% in Q1 FY2027, as government procurement for railways has been slow due to fund diversions to defense and other priorities.
- Cost pressures persist, with steel prices having increased by approximately INR5,000 per ton since January 2026, and the company has only been able to pass on a portion of these costs to customers.
- The company faces challenges in passing on cost increases in fixed contracts, such as those with railways and public sector units, which may limit margin expansion in the near term.
- Geopolitical tensions and global uncertainties, including the ongoing war and trade tariffs, pose risks to export growth, particularly in Europe, ASEAN, and China markets, which are currently down.
- The Bharuch plant's cylindrical roller bearing line has lower utilization compared to spherical roller bearings, and full ramp-up is not expected until Q3 or Q4 of FY2027, indicating a slower start for that product line.
- The company's CapEx for FY2027 is expected to be 8-10% of sales, but there may be timing differences in project execution, potentially spilling over to the next fiscal year.
Ladies and Gentlemen, Good day and welcome to Timken India Ltd Q1 FY2027 Post Result Earning Conference Call.
(Operator Instructions) Mr. Annamalai Jayaraj, 360 ONE Capital Market Pvt Ltd.
Thank you and over to you, sir.
Thanks, Sumit.
On behalf of 360 ONE Capital Market Pvt Ltd, welcome all to the Timken India Ltd 1Q FY2027 post-sensual conference call. From Timken Management, we have with us today, Mr. Sanjay Koul, Chairman and Management Director, Mr. Sujit Kumar Patnaik, Business Controller, India, CFO and full-time Director. I'll now hand out the call to Mrs. Sanjay Kaul for the opening remarks to be followed by questions and answers. Over to you, sir.
Thank you, Mr. Annamalai.
Thanks a lot. Hello to everybody and a very warm good afternoon and thank you for joining.
So, I must say it is my privilege and Sujit is with me, our privilege of
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