Valuation & Outlook: Weakness in auto sales is expected to act as a spoilsport on the performance of bearing companies like SKF. Being the largest bearings supplier (~28% market share) with significant auto exposure (45-50% of sales), auto demand remains a key overhang. Capital investment plans for FY20E are expected in the range of | 80-130 crore depending on the near term automotive segment performance. There has been a robust pick-up in industrial performance. However, the resultant increase in traded goods would cap margins and, hence, potential upside. In addition, declining topline growth is expected to result in negative operating leverage. Accordingly, we expect sales and EBITDA CAGR of 4.2%, 2.2%, respectively, in FY19-21E. We value the company at 24x P/E on FY21E EPS to arrive at a target price of | 1565/share. We revise our recommendation on the stock to REDUCE.