Schaeffler India posted a strong set of earnings in its third-quarter results. The Q3 performance was driven by demand revival and a realisation of operational efficiency initiatives.

Speaking with CNBC-TV18, Harsha Kadam, Managing Director and Chief Executive Officer of Schaeffler India, said, “The Q4 CY20 performance has been strong primarily coming on the back of countermeasures that we put in place during the lockdown as well primarily on three areas. One is a clear focus on sales - revenue generation; two, strict cost control and spend; and three, on taking our projects to closure. These three helped us to get where we are.”

On margin guidance, Kadam said, “We are facing some strong headwinds when it comes to input cost primarily on steel price. So at this point in time, putting numbers to margin is pretty challenging. On sales growth, we expect to be back in the race and our internal plan is we should try and cross the Rs 5,000 crore mark this year.”

Speaking about costs control measures, he said, “Cost control measures that we put in place not all of it would definitely be able to be sustained, coming in 2021 now that the markets have recovered so we will foresee 20-25 percent of the cost is what we believe can be sustained but certainly we will continue to work on operationally efficiency improvements to see how we can close the gap.”

On localisation, Kadam said, “We were in the range of about 70 percent localisation at the end of 2020. I am happy to stay that we have touched 75 percent localisation and our endeavour and effort will continue to improve further going forward on the localisation front.”

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(Edited by : Ajay Vaishnav)

First Published:Feb 18, 2021 3:55 PM IST