Religare Institutional Research expects demand for bearings in India to revive over FY15-FY17, given the sector's strong correlation to economic growth and rising demand traction from the end-user industrial and auto verticals.

''Sustainable entry barriers (0.24x HHI = limited competition) support a strong return and cash flow profile, with market leader SKF posting an average ROCE of 29% along with positive FCF over the past decade. We reiterate Buy on SKF and also profile two promising bearings players - FAG and Timken India,'' the broking firm said.

''All the three multinational companies, SKF, Schaeffler (parent of FAG), and Timken India have business interests and manufacturing facilities outside of the listed company in India. Introduction of higher value industrial bearing products through these non-listed entities, or suboptimal deployment of capital in fellow subsidiaries is a key risk,'' it added.

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