Bosch - Stringent Emission Norms, Premiumisation To Benefit: ICICI Direct

Bosch’s stock price has remained flattish over five years, thereby underperforming the Nifty Auto index.
<div class="paragraphs"><p>Bosch Ltd. corporate office building. (Source Company website)</p></div>
Bosch Ltd. corporate office building. (Source Company website)

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ICICI Direct Report

Bosch Ltd. is a technology leader providing solutions in automotive, industrial technology, consumer goods, energy and building technology.

Bosch posted steady Q3 FY23 results. Total operating income was flat QoQ at Rs 3,660 crore.

Automotive products segment grew 3% QoQ to Rs 3,240 crore while consumer goods and others segment de-grew 14% QoQ to Rs 448 crore.

Key triggers for future price performance:

  • Leadership positioning in powertrain technology with parent supported ready solutions for flex fuel, BS VI phase II transition, electric vehicles and hybrids.

  • With volume growth on the anvil in medium and heavy commercial vehicle and utility vehicle space, potential content increase in BS-VI stage-II transition, incremental order wins on account of emission rollover in construction equipment space, we expect the topline at the company to grow at a compound annual growth rate of 16.5% over FY22-25E.

  • With operating leverage at play, continuous focus on calibrated localisation initiatives, we bake in margin improvement to 14% levels by FY25E.

Click on the attachment to read the full report:

ICICI Direct Bosch Company Update.pdf
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