SNL

BEARINGS
(Shriram Needle Bearing)
COMPANY PROFILE:
SNL Bearings Ltd previously known as Shriram Needle Bearing Industries
manufactures needle bearings which are used widely in the automobile and general
engineering industries. It is started in the year 1979. Stabilisation of production systems
in some of the existing product lines and development of new products resulted in a
remarkable uptrend in the performance of the company in 1994.

According to (BIFR) Board of Industrial and Financial Reconstruction order interest due
to financial institutions were converted into equity with effect from 1 April 1993. The
company again became a subsidiary of (SRF) Shriram Fibres Limited in 1994. Upon
further conversion of loan into equity shares by financial institutions, the percentage of
shareholding of Shriram Fibres Limited and its subsidiaries fell below 50% and SNBL
ceased to be a subsidiary of Shriram Fibres Limited with effect from May 30, 1996. It
got de-listed from Board of Industrial and Financial Reconstruction with effect from 18
June 1996 consequent upon the net worth becoming positive and losses being wiped out.

SNBL currently exports to customers in USA, Europe and southeast Asia. The company
is planning a major expansion and diversification at Noida. The first production line is
being commissioned at Noida, Utter Pradesh.

VISION:

To provide superior quality products with high performance and become a

preferred supplier of needle roller bearings across the globe.

PRODUCTS:
Small end cage, Big end cage, full complement shell cage, guided shell.

QUALITY:
SNL individually and collectively are committed to seeing their customers
delighted and satisfied with the perfection of products they provide as a
manufacturer and supplier of Needle Roller Bearings and its allied services.
They told to keep watch and ensure a continual improvement of level of
perfection in their working by following and spreading across a standard method
and system in their organization.

SLOWDOWN:
During the year 2000-01 the company has faced slump in its offtakes from the
automotive industry particularly the twowheeler commercial vehicles and tractor
segments which experienced a slowdown in demand from the final consumers.

CAREER:
They offer an open work environment that rewards performance. Motivated
professionals can look forward to a lively corporate culture that facilitates career
growth and self development.
 LIQUIDITY RATIOS:

1.CURRENT RATIO:
Current ratio = current assets / current liabilities
Table no.1 (comparison of current ratio of SNL bearings Ltd in 2019 with that of Austin
engineering limited, Benara bearings and Bimetal bearings).

Competitors

SNL Austin Benara Bimetal

bearings engineering bearings bearings

Current ratio 7.11 2.71 2.07 3.96

Interpretation: The ideal ratio is 2:1. When compared to competitors in the above table
Austin engineering, benara bearings and bimetal bearings, SNL is having high position in
liquidity.

2.QUICK RATIO:
Quick ratio = quick assets / quick liabilities
Table no.2 (comparison of quick ratio of SNL bearings Ltd in 2019 with that of Austin
engineering ltd, Benara bearings and Bimetal bearings).

Competitors

SNL Austin Benara Bimetal

bearings bearings bearings
engineering

Quick ratio 3.87 1.02 1.16 2.32

Interpretation: Standard ratio 0.5:1
Ideal ratio 1:1
On the whole of liquidity position SNL bearing is leading and having more chances to invest

OPERATIONAL EFFICIENCY 5 RATIOS:

1.INVENTORY TURNOVER RATIO:

𝑪𝒐𝒔𝒕𝒐𝒇𝑮𝒐𝒐𝒅𝒔𝑺𝒐𝒍𝒅
𝑰𝑻𝑹 =
𝑨𝒗𝒆𝒓𝒂𝒈𝒆𝑰𝒏𝒗𝒆𝒏𝒕𝒐𝒓𝒚

Table no.3 (comparison of quick ratio of SNL bearings Ltd in 2019 with that of Austin
engineering ltd, Benara bearings and Bimetal bearings).

Competitors

SNL Austin Benara Bimetal

bearings bearings bearings
engineering

Inventory 3.17 2.05 3.24 4.55

turnover ratio

INTERPRETATION: Inventory turnover ratio must be high When compared to

competitors but SNL is in medium position and BIMETAL bearings having highest
position. Therefore less chances for investment for SNL bearings.

STOCK CONVERSION PERIOD:

𝟑𝟔𝟓𝑫𝒂𝒚𝒔
𝑺𝒕𝒐𝒄𝒌 𝑪𝒐𝒏𝒗𝒆𝒓𝒔𝒊𝒐𝒏 𝑷𝒆𝒓𝒊𝒐𝒅 =
𝑰𝒏𝒗𝒆𝒏𝒕𝒐𝒓𝒚 𝑻𝒖𝒓𝒏𝒐𝒗𝒆𝒓𝑹𝒂𝒕𝒊𝒐
Table no.4 (comparison of quick ratio of SNL bearings Ltd in 2019 with that of Austin
engineering ltd, Benara bearings and Bimetal bearings).
 Company 365 days Inventory Inventory
Turnover Ratio Conversion Period
SNL bearings 365 3.17 115 days

365 2.05 178 days

Austin
engineering
Benara bearings 365 3.24 112 days

Bimetal bearings 365 4.55 80 days

2.CREDITORS TURNOVER RATIO:

Asset turnover = Net sales value/average of total assets
Table no.5(comparison of quick ratio of SNL bearings Ltd in 2019 with that of Austin
engineering ltd, Benara bearings and Bimetal bearings).

Competitors

SNL Austin Benara Bimetal

bearings bearings bearings
engineering

Creditors 3.17 2.25 2.12 3.05

turnover ratio

INTERPRETATION: Accounts are settling rapidly fast for SNL bearings when compared to
other three competitors.

3.DEBTORS TURN OVER RATIO:

𝑮𝑹𝑶𝑺𝑺 𝑺𝑨𝑳𝑬𝑺
𝑫𝒆𝒃𝒕𝒐𝒓𝒔𝑻𝒖𝒓𝒏𝑶𝒗𝒆𝒓𝑹𝒂𝒕𝒊𝒐 =
𝑻𝑶𝑻𝑨𝑳 𝑫𝑬𝑩𝑻𝑶𝑹𝑺
Table no.6 (comparison of quick ratio of SNL bearings Ltd in 2019 with that of Austin
engineering ltd, Benara bearings and Bimetal bearings).

Competitors

SNL Austin Benara Bimetal

bearings bearings bearings
engineering

Debtors 6.03 4.85 3.05 3.96

turnover ratio

INTERPRETATION: In the above table debts are being collected rapidly by SNL bearings
when compared with the other three competitors.

AVERAGE COLLECTION PERIOD:

𝟑𝟔𝟓𝑫𝒂𝒚𝒔
𝑨𝒗𝒆𝒓𝒂𝒈𝒆𝑪𝒐𝒍𝒍𝒆𝒄𝒕𝒊𝒐𝒏𝑷𝒆𝒓𝒊𝒐𝒅 =
𝑫𝒆𝒃𝒕𝒐𝒓𝒔𝒕𝒖𝒓𝒏𝒐𝒗𝒆𝒓𝑹𝒂𝒕𝒊𝒐

Table no.7 (comparison of quick ratio of SNL bearings Ltd in 2019 with that of Austin
engineering ltd, Benara bearings and Bimetal bearings).

Company 365 days Debtors Turnover Debtors Conversion

Ratio Period
SNL bearings 365 6.03 60 days

Austin 365 4.85 75 days

engineering
Benara bearings 365 3.05 119 days

Bimetal bearings 365 3.96 92 days

 SOLVENCY RATIOS:
1.DEBT EQUITY RATIO:
Debt Equity Ratio = Long term debts / shareholder funds

Table no.8 (comparison of quick ratio of SNL bearings Ltd in 2019 with that of Austin
engineering ltd, Benara bearings and Bimetal bearings).

Competitors

SNL Austin Benara Bimetal

bearings bearings bearings
engineering

Debt Equity 4.25 2.71 2.07 3.96

ratio

INTERPRETATION: The debt ratio indicates the margin of safety to the creditors, A high
ratio shows a large share of financing by the creditors which the SNL bearings is having
whereas low ratio implies a smaller claim of creditors which the other 3 competitors are having.
Ideal ratio is 1:2

PROFITIBILITY RATIOS:
1.GROSS PROFIT:
Gross profit = Gross profit/net sales
Table no.9 (comparison of gross profit of SNL bearings with the past two years)

Years 2019 2018 2017

GROSS PROFIT 25.22 28.90 29.62

INTERPRETATION: This is an indication to investors how much company is earning for
every dollar. A low margin indicates a company is under-pricing. Generally the ideal gross
profit is 20% which is considered to be good. SNL bearings is having high gross profit but it
is decreasing when compared to previous years. So the company is getting low profit margins
when compared to last two years.

2.RETURN ON CAPITAL EMPLOYED:

Return on Capital Employed = PBIT / Capital Employed * 100
Table no.10 (comparison of Return on capital employed of SNL bearings with the past two
years)

Years 2019 2018 2017

Return On 33.23 40.22 49.98

Capital employed

INTERPRETATION: Return on capital employed is a financial ratio that measures a

company profitability and the efficiency with which its capital is used. The ideal ratio
percentage is 30% and when we see the SNL bearings it had 49.98% in 2017 but when we
see the current scenario it decreased to 33.23%. So the profitability is decreasing year by
year. Now the percentage is good but again in future it may decrease.

3.NET PROFIT MARGIN:

Net Profit Margin = Net Profit / Net Sales
Table no.11 (comparison of Net Profit Margin of SNL bearings with the past two years)

Years 2019 2018 2017

NET PROFIT 33.9 38.7 40.2

MARGIN

INTERPRETATION: The net profit margin is equal to net profit (net income). The net
profit percentage should be minimum 15 to 20% but 40 to 50% then the company is really
enduring. But SNL bearings is decreasing every year in which 2017 it has the ideal profit
percentage whereas now it is reaching to minimum profit levels.

4.OPERATING PROFIT OR PBIT MARGIN:

Operating Profit Ratio = Operating Profit / Net Sales
Table no.12 (comparison of Operating Profit ratio of SNL bearings with the past two years)

Years 2019 2018 2017

OPERATING 6.26 6.06 5.50

PROFIT (or)
PBIT MARGIN

INTERPRETATION: Operating profit margin ratio indicates how much profit a company
makes after paying for variable costs of production such as wages, raw materials, etc. It is
also expressed as a percentage of sales and then shows the efficiency of the company
controlling the costs and expenses.5% margin is considered as low and 10% is considered
average and 20% is good. Now the company stands with 6.26% which is just above the low
percent when it is increasing from the last two years which is a good sign.

CASH FLOW ANALYSIS:

Table no.13 shows cash flow of SNL bearings for the year of 2019 (in crores/cr):
ACTIVITIES 2018-19

OPERATING ACTIVITIES 4.75

INVESTING ACTIVITIES -9.14

FINANCING ACTIVITIES -0.62

SOURCES :
https://www.moneycontrol.com/financials/snlbearings/ratiosVI/SNB#SNB
https://www.moneycontrol.com/financials/snlbearings/profit-lossVI/SNB#SNB
https://www.moneycontrol.com/financials/austin engineering/ratiosVI/SNB#SNB
https://www.moneycontrol.com/financials/benarabearings/ratiosVI/SNB#SNB
https://www.moneycontrol.com/financials/bimetalbearings/ratiosVI/SNB#SNB

Decision whether to invest in this company or not?

Years 2019 2018 2017

Basic EPS 22.55 22.72 18.32

SOURCES :
https://www.moneycontrol.com/financials/snlbearings/ratiosVI/SNB#SNB

To get a good return in stocks SNL bearings can be a profitable investment option.
SNL bearings quote is equal to 222.95 in 2019 and as a long-term investment for 5years it
may go up to 344.80 which is 54.66% increasing.
So if the current value is $100 investment after 5 years we can get $154.66 in 2024.
According to present data SNL bearings shares increase potentially it’s market environment
have been in bearish cycle last 12 months.
I analyse that there will be a positive trend in future and the SNL bearings ltd shares might be
good for investing for making money. Since this share has a positive outlook I recommend it
as a part in the portfolio. Trading in bull markets is always easier so we might want to favour
these shares under the given circumstances but always readup on optimal investment
strategies if we are new to investing.

Bid 210.10
Day’s range 203.05-222.95
52week range 171.1-394
Closing balance 224
Opening balance 203.05
Volume 202
Average volume 477
Market capital 801.76
p/e ratio 10.12
dividend 5.00(2.44%)
revenue 419.12M
EPS 22.14
1-year change +54.66%
So I will invest in the company SNL bearings for future returns.
 BALANCE SHEET
EQUITIES AND LIABILITIES
SHAREHOLDER'S FUNDS
Equity Share Capital 3.61 3.61 3.61 3.61

Preference Share Capital 0.00 0.00 0.00 0.25

Total Share Capital 3.61 3.61 3.61 3.86
Reserves and Surplus 30.63 24.68 16.30 11.02
Total Reserves and Surplus 30.63 24.68 16.30 11.02
Total Shareholders Funds 34.24 28.29 19.91 14.88
NON-CURRENT LIABILITIES
Long Term Borrowings 0.00 0.00 0.00 1.05
Deferred Tax Liabilities [Net] 1.29 1.25 1.27 1.07
Total Non-Current Liabilities 1.29 1.25 1.27 2.47
CURRENT LIABILITIES
Short Term Borrowings 0.09 0.00 0.70 0.16
Trade Payables 1.79 2.13 1.05 2.12
Other Current Liabilities 1.60 1.87 1.94 0.84
Short Term Provisions 0.47 0.42 0.51 2.18
Total Current Liabilities 3.95 4.42 4.20 5.31
Total Capital And Liabilities 39.48 33.96 25.38 22.65
ASSETS
NON-CURRENT ASSETS
Tangible Assets 10.98 8.81 9.21 8.81
Intangible Assets 0.00 0.10 0.15 0.04
Capital Work-In-Progress 0.00 0.22 0.08 0.03
Intangible Assets Under Development 0.00 0.02 0.01 0.00
Fixed Assets 10.98 9.16 9.45 8.88
Deferred Tax Assets [Net] 0.00 0.06 0.04 0.00
Long Term Loans And Advances 0.26 0.26 0.26 0.29
Other Non-Current Assets 0.14 0.00 0.00 0.00
Total Non-Current Assets 11.38 9.47 9.74 9.16
CURRENT ASSETS
Current Investments 8.08 8.72 1.07 0.00
Inventories 12.82 6.10 7.16 6.13
Trade Receivables 6.26 7.23 6.85 6.46
Cash And Cash Equivalents 0.16 1.23 0.16 0.64
Short Term Loans And Advances 0.07 0.05 0.04 0.26
OtherCurrentAssets 0.71 1.16 0.37 0.00
Total Current Assets 28.10 24.48 15.64 13.49
Total Assets 39.48 33.96 25.38 22.65
OTHER ADDITIONAL INFORMATION
CONTINGENT LIABILITIES, COMMITMENTS
Contingent Liabilities 0.00 4.81 4.84 1.61
CIF VALUE OF IMPORTS
Raw Materials 0.00 3.58 0.00 2.17
Stores, Spares And Loose Tools 0.00 0.03 0.00 0.02
EXPENDITURE IN FOREIGN EXCHANGE
Expenditure In Foreign Currency 0.00 0.00 0.00 2.39
REMITTANCES IN FOREIGN CURRENCIES FOR
DIVIDENDS
Dividend Remittance In Foreign Currency - - - -
EARNINGS IN FOREIGN EXCHANGE
FOB Value Of Goods - 0.61 - 0.21
Other Earnings - - - -
BONUS DETAILS
Bonus Equity Share Capital - - - -
NON-CURRENT INVESTMENTS
Non-Current Investments Quoted Market Value - - - -
Non-Current Investments Unquoted Book Value - - - -
CURRENT INVESTMENTS
Current Investments Quoted Market Value - - - -

Current Investments Unquoted Book Value - 8.72 1.07 -

-

PROFIT AND LOSS SHEET

INCOME
Revenue From Operations [Gross] 40.64 38.78 37.23 33.43
Less: Excise/Sevice Tax/Other Levies 0.00 0.97 4.18 3.76
Revenue From Operations [Net] 40.64 37.81 33.06 29.67
Other Operating Revenues 0.00 0.50 0.42 0.40
Total Operating Revenues 40.64 38.31 33.48 30.07
Other Income 1.16 0.30 0.18 0.00
Total Revenue 41.80 38.62 33.66 30.07
EXPENSES
Cost Of Materials Consumed 12.03 10.01 8.40 7.51
Changes In Inventories Of FG,WIP And Stock-In Trade -1.93 0.33 -0.43 0.31
Employee Benefit Expenses 8.71 7.48 6.92 6.12
Finance Costs 0.01 0.01 0.14 0.33
Depreciation And Amortisation Expenses 0.92 0.79 0.71 0.57
Other Expenses 10.66 8.62 7.97 6.71
Total Expenses 30.40 27.25 23.70 21.56
Mar
Mar 18 Mar 17 Mar 16
19

12
12 mths 12 mths 12 mths
mths

Profit/Loss Before Exceptional, ExtraOrdinary Items

11.40 11.37 9.96 8.51
And Tax
Profit/Loss Before Tax 11.40 11.37 9.96 8.51
Tax Expenses-Continued Operations
Current Tax 3.26 3.14 3.10 2.70
Deferred Tax 0.00 -0.02 0.22 0.13
Tax For Earlier Years 0.00 0.03 0.03 0.00
Total Tax Expenses 3.26 3.15 3.34 2.83
Profit/Loss After Tax And Before ExtraOrdinary Items 8.14 8.22 6.62 5.68
Profit/Loss From Continuing Operations 8.14 8.22 6.62 5.68
Profit/Loss For The Period 8.14 8.22 6.62 5.68
Mar
Mar 18 Mar 17 Mar 16
19
 12
12 mths 12 mths 12 mths
mths

OTHER ADDITIONAL INFORMATION

EARNINGS PER SHARE
Basic EPS (Rs.) 22.55 22.76 18.32 15.61
Diluted EPS (Rs.) 22.55 22.76 18.32 15.61
VALUE OF IMPORTED AND INDIGENIOUS RAW
MATERIALS
Imported Raw Materials 0.00 0.00 0.00 3.25
Indigenous Raw Materials 0.00 0.00 0.00 4.25
STORES, SPARES AND LOOSE TOOLS
DIVIDEND AND DIVIDEND PERCENTAGE
Equity Share Dividend 0.00 0.00 1.81 0.72
Preference Share Dividend 0.00 0.00 0.00 0.90
Tax On Dividend 0.00 0.00 0.37 0.33
Equity Dividend Rate (%) 50.00 50.00 30.00 20.00