Key takeaways of the call

India's GDP growth for FY21-22 is expected to be around 8%

Lot of initiatives are being done by the government of India that can have positive impact on the operations of the company.

Regional lockdowns during second wave of covid 19 had an impact on industrial production, although this time industry was betterprepared as compared to last year.

PV production on QoQ basis contracted 27%, two wheelers and three wheelers production contracted 38% on QoQ basis.

CV production contracted 50% on QoQ basis;it was showing signs of recovery but got hit hard by second wave of covid 19.

Company Secured key business wins across automotive and industrial business, which management believeswill sustain growth story for schaeffler India.

Steel prices continued to grow on QoQ basis. It remains a cause of concern for the company, but large part of the rise is already passed on.

Free cash flow (FCF) for Q2FY21 was negative due to issues with working capital management.Company expects it to come in positive zone from next quarteronwards.

In automotive technologies segment, company continued its long term business wins in chassis and engine segment for key relevant products.Also company continued to launch new products in after market segment.

All plants of the company are performing at normal capacity levels.

Company witnessed strong growth in exports segment, as range of products offered in exports widened. Going forward company expects this momentum to continue.

Company expects to sustain 13% EBIT margin going forward.

Working capital has gone up in Q2FY21 compared to Q1FY20.

In Q2FY21, capex investment stands at Rs 46 crore compared to Rs 43 crore in Q2FY20. In H2FY21management expects to incur more capex.

Company's plan to invest close to Rs 1000 crore in 3 years remains intact.

EBIT margin improved despite rise in steel prices due to improvement in sales mix during the quarter and passing on some portion of price hikes to the customers.

Company has strong market presence in two wheeler market, and with emergence on electric two wheelers. Company has started to explore this opportunity to meet the technology shift.

Company has good presence in wind market in industrial segment.

Management has shown intention to grow in railway segment as well.

Other Highlights

Management believes, if inflation rate reaches above the tolerance limit of 6%. It can trigger increase in interest rates and hence may hamper growth story.

Robust performance of the company continued despite strong headwinds from Covid-19 wave 2 and input cost pressures.

Company secured key wins in CV and Tractor segment for clutch transmission solutions.

Sales mix for Q2FY21 stands at- exports 14%, Industrial 39%, automotive technologies 39% and automotive aftermarket 8%.