| SNL Bearings Limited | ||||
| Rating reaffirmed at 'Crisil A/Stable' | ||||
| Rating Action | ||||
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| Note: None of the Directors on Crisil Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any ratings. The Board of Directors also does not discuss any ratings at its meetings. | ||||
| 1 crore = 10 million | ||||
| Refer to Annexure for Details of Instruments & Bank Facilities |
Detailed Rationale Crisil Ratings has reaffirmed its ‘Crisil A/Stable’ rating on the long-term bank facilities of SNL Bearings Ltd (SNL).
The rating continues to reflect the business, financial and managerial support that SNL receives from its parent, NRB Bearings Ltd (NRB, ‘Crisil AA-/Stable/Crisil A1+’). These strengths are partially offset by SNL’s modest scale of operations, large working capital requirement and vulnerability to cyclicality in the automobile (auto) industry.
SNL derives 32-37% of its revenue from NRB followed by 55-57% from the domestic auto original equipment manufacturers (OEMs) and balance through domestic and export aftermarket and scrap sales. Revenue grew by 7% on-year to Rs 51 crore during fiscal 2025, from Rs 48 crore in fiscal 2024, owing to rise in demand from the two-wheeler segment as well as sale of new product - Special Purpose Machine -to NRB. Revenue is expected to grow 6-7% over the medium term, with healthy demand across the auto segment.
Operating margin expanded by ~390 basis points to 25.6% during fiscal 2025, from 21.7% in previous fiscal, owing to moderation in steel prices (key raw material), implementation of cost optimisation techniques to cut on power and fuel cost leading to better efficiency. Operating margin may sustain at 24-25% over the medium term aided by higher operating leverage and partially offset by volatility in key material prices. Impact of regulatory guidelines such as imposition of safeguard duty on import of steel will remain monitorable.
The financial risk profile continues to be comfortable, supported by networth of Rs 68 crore as on March 31, 2025, and debt free balance sheet. The capital structure continues to be strong with total outside liabilities to adjusted networth (TOL/ANW) ratio at 0.11 time as on March 31, 2025, and is expected below 0.10 time over the medium term. Annual net cash accrual of Rs 10 crore projected over the medium term coupled with unencumbered cash surplus of Rs 36 crore as on March 31, 2025 will be sufficient to meet the yearly capital expenditure (capex) of Rs 2-3 crore over the next 2-3 years and any additional working capital requirement. |
Analytical Approach Crisil Ratings has assessed the standalone credit risk profile of the company and factored in support from the parent (NRB) considering it is in the same line of business and has strong operational and technical linkages with the parent. Crisil Ratings believes that SNL will, in case of exigencies, receive financial support from its parent. |
Key Rating Drivers & Detailed Description Strengths:
Weaknesses:
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Liquidity: Adequate Liquidity is supported by cash surplus of Rs 36 crore as on March 31, 2025. Furthermore, expected annual net cash accrual of over Rs 10 crore with nil debt obligation will increase the cash surplus over the years. Since the company is debt free, there is no pressure on the cash flow for repayment. This is further supported by unutilised bank lines of Rs 5 crore as on June 30, 2025. |
Outlook: Stable Crisil Ratings believes that SNL with continue to benefit from the growing demand in the auto industry, increase in OEM volumes and sustained profitability margin, resulting in higher-than-expected cash accrual. The financial risk profile is also expected to remain healthy, due to minimal capex, steady cash accrual and support from the parent company. |
Rating sensitivity factors Upward factors
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About the Company SNL, formerly known as Shriram Needle Bearing Industries Ltd, was established in 1979 by the Shriram group in Ranchi, Jharkhand. It was promoted as a joint venture of the DCM Shriram group, which has business interests in sugar, alcohol, fine chemicals and rayon tyre cord, and INA Germany, a leading manufacturer of bearings worldwide. The company got its current name after it was acquired by NRB Bearings in June 2000.
SNL manufactures cage-guided drawn cup needle bearings, connecting-rod needle cages for piston pins and crank pins, among other needle bearings. 33-36% of its output is sold to NRB Bearings. During the first quarter of fiscal 2026, SNL reported revenue of Rs 12 crore and profit after tax (PAT) of Rs 3 crore. |
About the parent Founded by late Mr Trilochan Singh Sahney in 1965, NRB manufactures needle, cylindrical, special ball and taper-roller bearings. It also makes other friction solution components such as planetary shafts, crank pins and kingpins. The company has five subsidiaries including stepdown subsidiaries: NRB Holdings Ltd, NRB Bearings Europe GmbH, NRB Bearings USA Inc and NRB Bearings [Thailand] Ltd) and SNL. SNL's facility is at Ranchi in Jharkhand, while NRB Thailand's plant is at Rayong in Thailand. The product engineering centre at Turbhe (Navi Mumbai; Maharashtra) and the process and advanced materials-based engineering centre at Waluj (Aurangabad; Maharashtra) are government accredited.
Ms Harshbeena S Zaveri, daughter of Mr Trilochan Singh Sahney, is the vice chairman and managing director of NRB and the chairman of the board of SNL. |
Key Financial Indicators (SNL)
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Any other information: Not Applicable |
Note on complexity levels of the rated instrument: |
Annexure - Details of Instrument(s)
* Interchangeable with Working Capital Demand Loan to the extent of Rs. 5 crores; Interchangeable with Letter of Credit (Import Usance & Inland LC) to the extent of Rs. 1 crores, Interchangeable with Bank Guarantee (Financial & Performance) to the extent of Rs. 3 crores |
| Annexure - Rating History for last 3 Years | |||||||||||||||||||||||||||||||||||||||
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| All amounts are in Rs.Cr. | |||||||||||||||||||||||||||||||||||||||
| Annexure - Details of Bank Lenders & Facilities | ||||||||||||
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Criteria Details
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