SKF India Ltd Company Summary

SKF India Ltd Summary

SKF India, the pioneer of ball bearing manufacturing of India is a part of AB SKF, Germany, a leading global supplier of bearings, seals, mechatronics, lubrication systems, and services which include technical support, maintenance and reliability services, engineering consulting and training. The companys manufacturing facility is located at Pune, Bangalore & Haridwar catering to automotive and industrial sectors of Northern and Peninsular India. Having commissioned the first manufacturing plant in Pune in the year 1965, the Company has three manufacturing facilities, 12 offices and a supplier network of over 450 distributors. It is a well-known supplier of ball bearings, catering to over 40 industries globally with products and services, both directly and indirectly. Being one of the leading bearing manufacturers known for its deep grove ball bearings, the Company has a strong presence across the industrial and auto sectors. It is able to offer unique solutions for companies across automotive, agriculture, construction, food and beverage, oil and gas, metals and other industrial sectors through its five technology-centric platforms - bearings and units, seals, mechatronics, lubrication solutions and services.Incorporated on 12th April 1961, the Company commenced its operations as a ball-bearing manufacturing company. To cater to the manufacturing demands, the production activity in the first factory at Chinchwad, Pune was started by the company in the year of 1965. After that, SKF India had launched its state -of- the art factory for SDGBB in Bangalore during the year 1989. In 1997, CR Seals India Pvt. Ltd. established a plant in Bangalore, which went on to become SKF Sealing Solutions India Pvt Ltd, now a part of SKF in India. During the year 2002, the company had established the SKF Center for Learning and also in the same year, SKF became the first bearing company in India to secure ISO/TS-16949 for the Automotive Business Unit. The Company inaugurated a center in 2004 for the development process under the name of SKF Application Development Center. Also in the identical year of 2004, SKF India had acquired Vibration Engineer and Consultants Pvt Ltd. The Company decided to implement Direct Customer Delivery model in place of its Indenting Commission Business for the imported SKF bearing with effect from September 2005 to reduce the delivery time. During the year 2006, the company had received the Dun & Bradstreet American Express Corporate Award and also rated as top Indian company in the Bearings Sector. In February 2007, the company had introduced its power transmission products in the Indian market. The products include timing belts, v-belts, chains, couplings, sprockets and pulleys. SKF India entered into a long-term relationship with wind power firm Suzlon Energy in November 2008 for supplying bearings for Indian wind turbine maker Suzlon Energy, the deal covers the worth of Euro 303 million. SKF India won the Green Manufacturer of the Year Award at the Auto Monitor Awards 2008. On 27 April 2009, SKE India announced the beginning of work for the new manufacturing site in Haridwar, Uttarakhand. The state of the art SKF technology will be operational by January 2010. The company will be investing Rs 150 crore in this project and plans to employ more than 200 people. This plant will specifically cater to the automotive market segment in India. Situated over an area of 10 acres, the new bearing factory will have a production capacity of 40 million bearings. Deep Groove Ball Bearings will be manufactured at this site to cater to the demands of the automotive and manufacturing sector.SKF inaugurated its first SKF Solution Factory in India at Pune on 3 November 2009. The ultimate objective of the SKF Solution Factory is to make SKF offerings from its five technology platforms - bearings and units, seals, mechatronics, services and lubrication solutions - more available for customers and provide them with customized solutions by combining and integrating different products, systems and services.SKF inaugurated its Global Testing Centre in India at Bangalore on 4 November 2009. The testing centre will be a hub of testing activities ensuring greater focus on customer requirements, cost, quality and operational efficiency. The main objective will be to conduct testing at close proximity to its customers for design, process and supplier validation.On 5 May 2015, SKF India announced that it has signed a strategic agreement with Regen Powertech, a leading Indian wind turbine manufacturer. Under the terms of the agreement, SKF will supply pitch and yaw bearing sets and mainshaft bearings for the companys 1.5 MW wind turbines.On 27 January 2016, SKF India announced its solar mission with inauguration of one of the largest rooftop solar installations among manufacturing companies in Pune, with 1 MW capacity. The launch of the project is a part of SKF Indias ongoing solar mission across all major facilities in the country. The Board of Directors of SKF India at its meeting held on 13 February 2017 approved a proposal for buy-back of fully paid up Equity Shares of the company (Buy-back) through the Tender Offer method at a price of Rs 1,500 per equity share, aggregating to an amount not exceeding Rs 390 crore. The board noted the intention of members of the promoter and promoter group to participate in the proposed Buy-back. On 24 April 2017, SKF India announced the inauguration of its Remote Diagnostic Center (RDC) in India. This diagnostic center will be located in their Pune Corporate Office. SKFs Remote Monitoring Service makes it possible for any company with Internet access to implement a world-class predictive maintenance (PdM) program for periodic or continuous monitoring of critical machinery.On 27 April 2017, SKF India announced the launch of its Multilog On-line System - IMx-8, at Windergy 2017 in New Delhi. IMx-8 is a compact device, engineered to address the modern day maintenance issues of wind energy industry. Windergy, hosted by Indian Wind Turbine Manufacturers Association (IWTMA) in partnership with Global Wind Energy Council (GWEC), is the largest conference and exhibition of the wind energy segment.Pursuant to the Regulations 29(1)(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and approval of the Board of Directors for buy-back of up to 2,600,000 equity shares of the Company for an aggregate amount not exceeding Rs 3900 million, the Company bought back 1,394,575 equity shares which were tendered by eligible shareholders and extinguished the equity shares bought on 21 June 2017. SKF was adjudged as one of Indias Most Admired Workplaces for 2017 by the Economic Times. The company also won awards for Excellence in CSR and Significant achievement for Environment Management from CII-ITC Centre of Excellence for Sustainable Development.During the FY2019, the company spent towards capital expenditure amounting to Rs 636.9 million. Considering the Companys strong cash reserves and its healthy cash flow generation, the members had approved a proposal for buyback of equity shares of the Company, at a price of Rs 2100/- per share during the fiscal year 2018-19. The offer size of the buyback was 21.73% of the aggregate paid-up equity share capital and free reserves of the Company and represented 3.70% of the total issued and paid-up capital equity share capital of the Company. The Company had utilized Rs 3990 million for the Buyback of equity shares of the Company and the share capital of the Company after the said buyback now stands reduced at Rs 494.38 million. The buyback process was completed and the shares were extinguished on 20 February 2019. SKF India Pune factory won the Frost & Sullivan Manufacturing Excellence Awards 2018 for the Future Ready Factory for Engineering Sector, Large Business. The company wpn the Best Sustainability Practice Award from Tata Steel SSE. SKF India is recognized with the Best Vendor award 2018-19 from the Transportation group of BHEL, Bhopal.During the FY2020, the company spent towards capital expenditure amounting to Rs 758 million. The Company has launched several projects under the green manufacturing initiatives and worked upon reducing the impact on the Environment. Various projects on saving of trees (reduction of paper usage), energy reduction, water reduction and oil consumption reduction were worked upon. In December 2020, the company has subscribed 27.55% equity shares in Sunstrength Renewables Private Ltd ,a company incorporated pursuant to the requirements of the Electricity Act 2002 and its rules commissioning a captive generating plant for generation and supply of electricity to SKF and it is in the final stage of commissioning.The Company incurred a capital expenditure of Rs. 753.4 million during the year 2021.During FY 21-22, Company created a SKF Unitised Solution - Wheel Unit, using SKF tapered bearing unit, having integrals premium quality rubber seals, and filled with grease which is sealed for life of the application, in this case it was wheel of pallet car used in steel sintering plant. SKF India launched a low-noise and low-vibration bearing for electrical motors in the AEM range. The Company recycled 564 tonnes of steel and 20,000 bearings, helping the Railways save on 22 lakh KWH and avoid 1,432 tonnes of CO2 emission. They also benefited from increased profitability, enhanced machine uptime, lower OPEX and reduced maintenance.In FY22, the Company had invested in the special purpose vehicle company, for the purchase of electricity generated from captive solar power project for the Pune plant of the Company. Accordingly, the first tranche of investment was done in December 2020 and the second tranche of investment was done in March 2021 by SKF India in Sunstrength Renewables Private Limited to comply with the captive requirements.During FY 21-22, the Company undertook the green manufacturing initiatives across its Pune factory. In line with ISO 50001 guidelines, it identified significant energy users in the manufacturing processes, such as grinding channels (36%), heat treatment (21%), centralised utilities (19%), compressors (18%) and others (6%), through energy review process. It Identified and completed 67 energy-saving activities and projects to reduce both fixed and variable energy components. Specific electrical energy consumption reduced from 15.3 MWh / MINR in FY21 to 14.7 MWh/MINR in FY22; VASC GWh reduced by 4% over FY21. As part of SustEn Six Sigma umbrella project, the Company, identified and closed more than 750 compressed air leakages, reducing the specific energy consumption of compressors from 0.148 KW/CFM to 0.144 KW/CFM. Heat treatment furnace insulation revamping was carried out for 3 furnaces, resulting in reduced thermal losses and subsequent energy consumption reduction. All prewashing units on all the furnaces were modified with adequate PLC control systems with PID control system for washing media and hot air blowers, resulting in annual energy savings of 0.11 GWh. For its Bengaluru factory, Specific electrical energy consumption reduced from 16.7 MWh/MINR in FY21 to 16.3 MWh/MINR in FY 21-22; VASC GWh reduced by 2.5% over FY21. It installed a new variable speed compressor for better optimization of energy at part loads at low as well as high pressure networks, with operating range of 200 to 755 CFM with specific energy from 0.148 to 0.122 KW/CFM. Auto tube cleaning machine for chiller condenser was installed to maintain the condenser efficiency; resultant energy saving of around 5,000 unit/year. It installed a new efficient white spirit pump (4% higher efficiency), energy saving of around 72,000 units/year; LED plant lighting system completed by 65%, and plan to reach 100% by end of 2021 with an investment of INR 4 million. The Company identified around 16 energy conservation projects with savings of Rs. 19 million. 2.2 KW induction motor of work head was replaced with 1 KW servo motor and drive on 22 machines, which will result in energy consumption reduction by 190 MWh per year. For Haridwar plant, each machine has its own hydraulic power pack, and post improvement one hydraulic power pack is used for two machines, resulting in elimination of one power pack. There was energy saving by reduction of compressor air leakage at plant (~286 major leakage points); energy consumption reduction for Air Handling Units (AHUs) in offices by establishing self-discipline in employees through communication and administrative control; there was reduction in energy consumption through modification in conveyor systems; reduction of energy consumption in CL-660 machine by changing the operation logic from star delta to star connections.Apart from this, the Company undertook various steps across its manufacturing facilities in FY22. The Pune factory started receiving farm solar power through captive solar power purchase agreement. This was enabled through an offsite solar project of 8.4 MW capacity from April 1, 2021, catering to 30% of the plants total yearly energy requirement. SKF Pune received 11.9 GWh of farm and roof top solar power, which is 33% of total power requirement. SKF Bengaluru received 17.7 GWh of farm and roof top solar power, which is 88% of total power requirement in FY 21-22. The Company completed pre-assessment for rooftop and ground mount solar panels in Haridwar factory.