Bosch Limited , a leading supplier of technology and services, has reported robust financial results for the second quarter, demonstrating strong growth across key segments despite market challenges.

Revenue and Profit Highlights

The company posted a total revenue from operations of INR 4,795 crores (470 million euros) in Q2, marking a 9.1% increase compared to the same quarter last year. This growth was primarily driven by higher demand in the passenger car and off-highway segments.

Bosch's profit before tax (PBT) before exceptional items stood at INR 730 crores (72 million euros), representing 15.2% of the total revenue from operations. This reflects a 7.9% increase over the same quarter of the previous year, attributed to a favorable product mix and optimization of expenses.

The profit after tax (PAT) for the quarter reached INR 554 crores (54 million euros), accounting for 11.6% of revenue from operations.

Segment Performance

Bosch's performance across various segments showcased mixed results:

1. Automotive Segment: Overall product sales increased by 11.9% compared to the same quarter of the previous year.

2. Power Solutions: This business grew by 9.5%, mainly due to growth in passenger car and off-highway segments.

3. Two-Wheeler Business: Witnessed an impressive growth of 81.8%, primarily driven by higher sales of exhaust gas sensors due to the ramp-up for OBDII norms implementation from April 1.

4. Mobility Aftermarket: Recorded a growth of 3.7%, with strong performance in diesel and filter systems.

5. Beyond Mobility Business: Experienced a decline of 14.4% in net sales over the same quarter of the previous financial year, mainly due to the sale of the "Video solutions, Access and Intrusions and Communication systems" business in May.

Financial Position

The company's financial position remains strong, as evidenced by the following key figures:

Management Commentary

Guruprasad Mudlapur, President of the Bosch Group in India and Managing Director of Bosch Limited, commented on the results: "This quarter, we recorded growth led by sustained demand in passenger car and off-highway segments coupled with increased sales in key components. This performance reflects our commitment to innovation and customer-centricity despite multiple headwinds."

Looking ahead, Mudlapur added, "Moving onto the next quarter, the festive season coupled with GST rationalization bring renewed optimism. We anticipate healthy demand across components driven by changing customer sentiments. With a strong portfolio and customer-first approach, Bosch Limited remains well placed to leverage these opportunities ahead."

Outlook

Bosch Limited's strong performance in Q2, particularly in the automotive and two-wheeler segments, positions the company well for future growth. The significant surge in the two-wheeler business, coupled with the positive outlook for the festive season and GST rationalization, suggests potential for continued momentum in the coming quarters.

However, investors should note the decline in the Beyond Mobility business due to the recent sale of a business unit. This may impact the company's diversification strategy and warrants monitoring in future quarters.

As Bosch continues to focus on innovation and customer-centric approaches, it appears well-equipped to navigate the evolving market landscape and capitalize on emerging opportunities in the automotive and technology sectors.

In a significant development for the automotive industry, Volkswagen has confirmed the resumption of chip supply from Nexperia, a Chinese-owned semiconductor manufacturer. This news marks a positive turn for carmakers who have been grappling with global chip shortages.

Key Points

• Nexperia, a Chinese-owned semiconductor manufacturer, has resumed chip supply to carmakers.
• Volkswagen has confirmed receiving the first deliveries of these chips.
• The supply chain appears to involve Bosch as an intermediary.

Impact on the Automotive Industry

The resumption of chip supply is likely to bring relief to the automotive sector, which has been significantly impacted by the global semiconductor shortage. This development could potentially ease production constraints that many carmakers have been facing.

Supply Chain Dynamics

While the exact details of the supply chain are not fully disclosed, the involvement of Bosch, a major automotive supplier, suggests a complex network of partnerships ensuring the flow of these critical components to carmakers.

This resumption of supply underscores the intricate nature of global supply chains in the automotive industry and highlights the importance of semiconductor manufacturers in keeping production lines running smoothly.