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Check Before You Invest : SNL Bearings Ltd

BSE: 505827 NSE: ISIN: INE568F01017
  |   Sector:  Automobiles   |   Industry:  Bearings

Snapshot

Q.1 Which industry/sub-sector does SNL Bearings Ltd belong to?
SNL Bearings Ltd belongs to the Automobiles sector, operating specifically within the Bearings segment.
Q.2 Is SNL Bearings Ltd a good quality company?
SNL Bearings Ltd is a good quality company, based on a consistently good multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is SNL Bearings Ltd undervalued or overvalued?
SNL Bearings Ltd appears Fair, as its key valuation ratios are in line with their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 12.75 12.47
Price to Book 1.82 2.09
Price to Sales 2.44 2.46
EV to EBITDA 7.98 8.06
Q.4 Is SNL Bearings Ltd a good buy now?
SNL Bearings Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of SNL Bearings Ltd?
SNL Bearings Ltd revenue growth is 7.3% for FY-2025, which is below its 5-year CAGR of 8.44%, indicating slower growth.

Q.2 Gross Profit margin of SNL Bearings Ltd?
SNL Bearings Ltd Gross profit margin which is the profit after deduction of direct costs, is 30.6% for FY-2025, which is above its 5-year median of 26.4%, indicating increasing margins.

Q.3 Operating Profit Margin of SNL Bearings Ltd?
SNL Bearings Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 25.67% for FY-2025, which is above its 5-year median of 24.23% indicating increasing margins.

Q.4 Net Profit Margin of SNL Bearings Ltd?
SNL Bearings Ltd Net Profit Margin is 21.22% for FY-2025, is above its 5-year median of 17.09%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 30.6 26.4
Operating Profit Margin (%) 25.67 24.23
Net Profit Margin (%) 21.22 17.09

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of SNL Bearings Ltd?
SNL Bearings Ltd Return on Asset is 13.55%, which is above its 5-year historical median of 11.28%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of SNL Bearings Ltd?
SNL Bearings Ltd Return on capital employed is 22.22% for FY-2025, which is in line with its 5-year historical median of 21.73%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of SNL Bearings Ltd?
SNL Bearings Ltd Return on equity is 17.05% for FY-2025, which is in line with its 5-year historical median of 16.34%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of SNL Bearings Ltd?
SNL Bearings Ltd Cash conversion cycle is 115 days, in line with its 5-year historical median of 111 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.64 0.66
ROE (%) 17.05 16.34
ROCE (%) 22.22 21.73
Cash Conversion Cycle 115 days 111 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of SNL Bearings Ltd?
SNL Bearings Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.03, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of SNL Bearings Ltd?
SNL Bearings Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of SNL Bearings Ltd?

Q.1 Promoter shareholding and pledge status of SNL Bearings Ltd?
Promoters hold 74.39% of the SNL Bearings Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does SNL Bearings Ltd performance compare with that of its Peers?

Q.1 Revenue growth of SNL Bearings Ltd vs industry peers?
SNL Bearings Ltd revenue CAGR is 8.44%, compared to the industry median CAGR of 7.72%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 7.3 7.7
Gross Profit Growth (%) 33.3 18.7
Operating Profit Growth (%) 30 15.4
Net Profit Growth (%) 37.5 22.4
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.64 0.9
ROE (%) 17.05 15
ROCE (%) 22.22 14.48
Cash Conversion Cycle (days) 115.2 102

Valuation & price assessment

Q.1 Stock return of SNL Bearings Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 7% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
7% 7% 2.8% -5.6%
Q.2 Valuation ratios of SNL Bearings Ltd vs historical?
The current P/E ratio of 12.75 is in line with than its historical median of 12.47, indicating that the stock is trading near its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 12.75 12.47 22.77
Price to Book 1.82 2.09 2.84
Price to Sales 2.44 2.46 2.46
EV to EBITDA 7.98 8.06 13.87

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