Bosch

Bosch Limited reported Q3 FY25 revenue from operations at 44,657 million INR, a 6.2% increase year-on-year. For the nine months ending December 2024, revenue stood at 131,768 million INR, growing 5.5% YoY. EBITDA for the nine-month period improved by 8.1% to 16,628 million INR, with the EBITDA margin expanding from 12.3% to 12.6%. However, profit after tax as a percentage of revenue declined from 12.3% to 10.3% QoQ and from 15.4% to 11.1% YTD, primarily due to a 471 million INR provision for restructuring in the Mobility business.

The Mobility business grew by 1.6% QoQ, largely driven by an 8.8% increase in the mobility aftermarket segment, fueled by higher demand for diesel systems, automotive batteries, and lubricants. The two-wheeler business saw robust growth of 23.9% QoQ, benefiting from increased sales of exhaust gas sensors and OBD2 norms implementation. Consumer goods and building technologies businesses also contributed positively with 8.8% and 7.6% QoQ growth, respectively.

Bosch is actively investing in advanced engineering solutions for future mobility, including electric vehicles and alternate fuels like hydrogen. The company highlighted its significant R&D investments, with over 2.5 billion EUR in fuel cell developments and 7-8 billion EUR in electrification over the past 10-15 years globally. Bosch India leverages its strong design-to-manufacture capabilities and the Bosch Software Development Center (BGSW) with 25,000 engineers to drive innovation locally and globally.

As part of a global realignment, Bosch is divesting its Building Technologies division. This is a relatively small business for Bosch India, contributing approximately 400-450 crores in revenue with an EBIT margin of about 6%. Management stated that this divestment is not expected to have a major impact on the company's overall business operations, as the global division has been sold to venture capitalist Triton, and the India portion is being transferred to a subsidiary before being taken back by Triton.

The company acknowledged global and Indian macroeconomic uncertainties, including disinflation, subdued demand, geopolitical tensions, and FPI pullout. Domestically, growth is expected to slow cyclically with weakening consumption. While the automotive industry grew 3% YoY in Q3 FY25, sequential decline was noted due to seasonal cyclicality and post-festive demand normalization. The heavy commercial vehicle segment remained subdued, and LCVs/three-wheelers experienced muted growth.

The aftermarket segment demonstrated strong growth across all sub-segments, including diesel components, lubricants, filters, and exports, with management confirming 'very good margins' in this area. For FY26, the after-sales division is expected to grow between 8% to 10%. Despite strong aftermarket performance, its full impact on overall EBITDA margins was partially offset by product mix changes, including slightly lower sales in power drain solutions in the current quarter.