BOSCHLTD - Bosch Ltd Share Price

Management's outlook for Bosch Limited is cautiously optimistic amidst a volatile global and domestic economic landscape. The UN has revised its global growth forecast for 2025, lowering it from 3.3% to 2.8%, influenced by trade and geopolitical risks. India's economy is projected to grow between 6.2% to 6.5% for FY 2026, with rural consumption being a key driver. The automotive industry in India has shown moderate growth, particularly in SUVs and premium segments, although small cars and sedans remain challenged.

Key forward-looking points highlighted by management include:

1. Mobility Business Growth: In Q4 FY 2025, the mobility segment reported a 14.9% quarter-on-quarter growth, driven by a 16.9% increase in the power solutions sector. For FY 2025, the mobility business grew by 7% year-on-year.

2. Revenue and EBITDA Trends: Revenue from operations increased to INR 49,106 million in Q4 FY 2025 (16% growth QoQ) and stood at INR 180,874 million for FY 2025 (8.1% growth YoY). EBITDA for Q4 FY 2025 was INR 6,469 million, reflecting a 16.1% increase YoY.

3. NOx Sensor Plant: The company inaugurated its NOx sensor Gen-3 production line, aiming for a capacity of 2.1 million sensors annually by 2027. This initiative enhances Bosch's clean mobility strategy.

4. Dividends: The management expressed confidence in sustaining dividend increases, reflecting a strong financial position with nearly debt-free status and substantial liquidity.

5. Electrification and OEM Collaborations: Efforts are ongoing with OEMs regarding eAxles and hydrogen technologies, with a focus on advancing electrification, which is key to future growth.

Despite challenges like inflation and consumer sentiment, Bosch Limited aims to maintain its growth trajectory through innovation, local sourcing, and strategic investments in new technologies and markets.

Major Questions and Respective Answers from the Q&A Section

1. Question by Pramod Amte:
"Does the Nox plant qualify under PLI? And if so, what is the extent of benefit one?"

Answer:
"No, this plant does not qualify under the PLI and we did not apply. We constantly screen all the PLI schemes to assess our eligibility, but for now, this specific plant is not applicable."

2. Question by Pramod Amte:
"What has helped in easing purchase goods from peak levels, and where do you see costs settling down in the coming quarters?"

Answer:
"Our localization efforts, focusing on both finished goods and components, have significantly contributed to this easing. We are cautious in our approach, localizing step by step to maintain quality while improving our cost structure."

3. Question by Pramod Amte:
"Have you won any new clients in the OBD 2 space in the two-wheeler segment?"

Answer:
"Yes, we serve almost all major OEMs in the two-wheeler sector consistently. There are no OEMs currently outside our scope, and we continue to engage with them as we progress."

4. Question by Sriram:
"What is the breakup between two-wheeler, passenger vehicle, and CV within the mobility space?"

Answer:
"We do not provide a segmented breakdown of automotive sales; we assess our mobility business collectively. However, we are focused on total performance across our automotive segments."

5. Question about tariffs:
"Any updates on the Trump tariff specification implementation?"

Answer:
"As of now, there is no change in implementation dates. We are prepared to roll it out as confirmed by the government, though uncertainty remains regarding the exact timing."

6. Question about exports:
"Considering the current volatility in global markets, do we see further opportunities for exports?"

Answer:
"Yes, there are ongoing opportunities. We keep monitoring the dynamics related to tariffs and agreements closely, aiming to enhance our export capabilities. We anticipate a slight increase in export business, particularly with new opportunities emerging."

7. Question by Iqbal Khan:
"Do you have orders in place for eAxle from OEMs?"

Answer:
"We are in varying stages of negotiations with several OEMs regarding eAxles but cannot disclose specific deals yet. As agreements are finalized, we will inform stakeholders."

8. Question about dividend policy:
"What will be the dividend distribution policy moving forward?"

Answer:
"We had a very successful year with an 8.1% revenue increase and a strong balance sheet, allowing us to reward shareholders through dividends. We aim to appreciate our shareholders and reflect that in future distributions as we maintain solid market performance."

9. Question about hydrogen engine development:
"What updates do you have on the hydrogen engines worked on with an Indian OEM?"

Answer:
"Our collaboration continues with various OEMs and other players on hydrogen technology. The development of the hydrogen ecosystem, including generation and distribution, is ongoing, and we are maturing our technology progressively."

10. Question on growth drivers:
"What growth drivers do you foresee beyond typical industry growth?"

Answer:
"Key drivers will include premiumization, regulatory changes, and technology advancements. Electrification remains a focus area with ongoing innovations expected to contribute to our growth trajectory."