Schaeffler India Ltd’s shares have risen over 7% after its consolidated Ebitda for the quarter ended December (Q4CY25) jumped 36% year-on-year to ₹506 crore, beating analysts’ estimates.
The figure is adjusted for labour code impact. The automobile component manufacturing company’s earnings were supported by a relatively slower pace of growth in employee expenses and raw material costs, even though other expenses grew sharply by 44%.
Plus, revenue growth was strong at 28% to ₹2,742 crore, aiding operating leverage and higher localisation, leading to lower import costs.
The company follows a January to December financial year. For the full year 2025, revenue and Ebitda rose by 16% and 23%, higher than the 2024 figures of 12% and 11% respectively.
Nuvama Institutional Equities has raised its earnings per share (EPS) guidance for 2026 and 2027 by 4%, factoring in higher revenue and margin assumptions.
“We reckon revenue/Ebitda CAGR of 10%/12% over CY25–27 with return on invested capital of 29%,” said the broking firm in a report.
For Schaeffler, exports (including sales to group companies) have been a star performer, clocking robust 33% growth in 2025, though a moderation is in store ahead. In the Q4CY25 earnings call, management said export growth is expected to be 5-10% in 2026.
Exports increased as much as 49% year-on-year in Q4, as a weak rupee improved competitiveness. This share in total revenue rose to 15% in Q4 from 12% a year ago. Within the domestic market, the automotive technologies or auto components segment grew by an impressive 42%, buoyed by strong traction in automobile demand, following the goods and services tax cut in September.
Besides, a low inflation rate, leading to higher disposable income, and attractive interest rates are adding to the momentum. The company also exceeded its targets for e-axle, a new sub-segment catering to electric vehicles (EVs), for 2025, backed by strong execution and demand traction.
Vehicles lifetime solutions (VLS), or the after-sales segment, recorded 23% growth in Q4. Bearings & industrials (BIS), catering to non-auto segments, also remained weaker than other segments, but saw a pick-up in growth rate to 13%, against 4% in the first nine months of 2025.
The segment has been affected by delays in project-based orders. BIS is the largest segment for Schaeffler and accounted for 39% of Q4 revenue, followed by automotive technologies at 35% and VLS at 11%.
The capacity utilization of plants in Q4 crossed 85%. Schaeffler has guided for capital expenditure of ₹500 crore in 2026, against ₹375 crore in 2025. The company also completed the relocation of clutch manufacturing line for tractors from the UK facility to Hosur, Tamil Nadu, which would add to its financials in 2026.
The plant was facing low capacity utilisation, with the European market transitioning to EVs from internal combustion engine-based vehicles.
To be sure, robust financial performance and outlook have meant investors are sitting on solid returns of over 40% on Schaffler India’s shares.
The stock is trading at 50 times 2026 estimated EPS, as per Bloomberg consensus, above its long-term average multiple of 44x. The ramp-up of the new facility and the extent of moderation in export growth would determine the stock’s trajectory ahead.