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Bosch Ltd

| Q2 FY25-26 Process Conference Call

NEUTRAL SENTIMENT

Report Source

⬤11th Nov 25

Summary : Bosch Limited reported strong Q2 FY'25-26 growth in mobility, driven by auto demand and new technologies, while navigating global uncertainties and domestic fiscal concerns.

Management Perspective positive : We are confident in our ability to navigate these cross-currents, optimizing our operations to capture growth from India's buoyant domestic demand. We are very positive about the growth opportunities.

Concall Report Analysis & Insights

Business Overview

  1. Indian economy shows powerful resilience, supported by strategic policies and consumption growth.
  2. Global optimism is tempered by financial concerns at home, with mild fiscal slippages.
  3. Indian auto industry saw steady growth across all segments, driven by SUVs, EVs, and commercial vehicles.
  4. Mobility business grew 11.9% Q-o-Q, primarily from power solutions and two-wheelers.
  5. Revenue for April-September 2025 grew 10% to 95,834 million INR, with EBITDA up 16.3%.

Future Growth Prospects

  1. Passenger car growth projected to reach all-time high in FY'26 due to new models and GST overhaul.
  2. Commercial vehicle segment anticipates gradual growth, supported by infrastructure and replacement needs.
  3. Tractor market projected for all-time high, fueled by rural sentiment, monsoon, and GST norms.
  4. Two-wheeler segment expects all-time high, driven by replacement demand and urban consumption revival.
  5. Expanding product portfolio and leveraging robust strengths in mobility aftermarket and power tools.

Management Insights

  1. Confident in ability to navigate cross-currents, optimizing operations to capture India's domestic demand.
  2. GST reforms significantly boosted affordability and pre-festive buying in the auto sector.
  3. Sensor-less quick shift technology debuted in India, enhancing mobility solutions.
  4. Anticipating strong momentum recovery in mobility aftermarket post GST 2.0 transition.
  5. Committed to increasing exports in the long run, but currently assessing global situation cautiously.

Signs of Skepticism

  1. Management was cautious on exports, citing geopolitical space and tariffs.
  2. EV business is a tough entry right now, with margin pressure remaining.
  3. Consumer goods growth was lower than expected, attributed to exchange rates and material costs.
  4. Supply issues for Xperia are still tentative, requiring cautious play.

Risk Factors

  1. Global stage presents challenges from tariff pressures and geopolitical unrest influencing market sentiments.
  2. Slight concerns on fiscal slippages and oscillating liquidity at home.
  3. Consumer goods business experienced lower than expected growth due to adverse exchange rates and higher material costs.
  4. Mobility aftermarket turnover impacted by GST 2.0 due to dealer stock liquidation.
  5. Caution advised on exports due to geopolitical space, tariffs, and landed costs.

Good To Know

  1. Bosch received awards for on-time delivery, supply reliability, and hydrogen ICE technology innovation.
  2. Technical Centre India (TCI) celebrated its 25th anniversary, underscoring innovation commitment.
  3. Sensor-less quick shift technology debuted in India, deployed in Bajaj Pulsar NS400Z.
  4. Bosch honored with Hero MotoCorp's Hero Premium Leader Award.
  5. Working with OEMs on all technology options, including non-ferrite motors and hybrid systems.

Key Drivers

  1. GST reforms boost auto affordability.
  2. Strong festive demand drives sales.
  3. New product launches expand portfolio.
  4. Infrastructure projects bolster CVs.

Key Analyst Discussions

Competitive Environment

  1. Bosch's sister company is a market leader in ABS for two-wheelers.
  2. Bosch is working with top two-wheeler makers, supplying components for electric scooters.
  3. Exploring non-ferrite motors and discussing hybrid systems with OEMs globally and locally.

Market Trends & Consumer Behavior

  1. GST reforms and festive demand triggered a sharp rebound in passenger vehicles.
  2. Strong rural sentiment, favorable monsoons, and GST norms fuel tractor demand.
  3. Consumer focus on safety and personalization drives increased content per vehicle.

Financial Highlights

  1. Analyst questioned slow growth and severe profit damage in the consumer division.
  2. Management attributed consumer division issues to adverse exchange rates and higher material costs.
  3. Improved material costs due to favorable product mix and increased localization.

Product Composition

  1. Mobility business growth driven by power solutions and two-wheeler exhaust gas sensors.
  2. Consumer goods growth from new launches in entry/mid-price segments and outdoor garden equipment.
  3. GDI technology is mature and fully compliant with CAFÉ norms, expected to continue traction.

Strategic Considerations

  1. Bosch is prepared for increased ABS demand from potential legislation changes.
  2. Making steady progress in EV business, but margin pressure remains.
  3. Hydrogen ICE engine technology is in maturity phase, with pilot vehicles being tested by OEMs.
  4. Hydrogen technology market penetration expected at 8-15% by 2030 in heavy commercial vehicles.
Bosch Ltd (BOSCHLTD) Concall Report Analysis & Insights | Dhanarthi