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Erratic monsoon and rural sentiment impact on tractor segment
View Risks →Bosch Limited — Q4 FY24
Bosch Limited reported Q4 FY24 revenue of INR 4,423 crore, up 4.2% YoY, with EBITDA margin improving 30 bps to 13.2%.
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Bosch Limited reported Q4 FY24 revenue of INR 4,423 crore, up 4.2% YoY, with EBITDA margin improving 30 bps to 13.2%. Growth was driven by Mobility Aftermarket (+9.4%), Two-Wheeler (+17.6%), and Consumer Goods (+10.5%), while Power Solutions remained flat due to weak tractor demand. PAT surged 41.4% YoY, aided by a one-time income tax credit. Management expects moderate growth in FY25, with Q1 impacted by elections and liquidity constraints, but a recovery from Q2. Key risks include erratic monsoons affecting rural demand, potential three-wheeler encroachment on LCVs, and portfolio realignment uncertainties. The company continues to focus on localization and cost measures to sustain margin improvement.
बॉश लिमिटेड ने चौथी तिमाही (जनवरी-मार्च 2024) में 4,423 करोड़ रुपये का कारोबार किया, जो पिछले साल से 4.2% ज़्यादा है। कंपनी का मुनाफा (EBITDA) 13.2% रहा, जो पहले से थोड़ा बेहतर है। गाड़ियों के पुर्जों की बिक्री (आफ्टरमार्केट) 9.4%, दोपहिया वाहनों में 17.6% और उपभोक्ता सामान में 10.5% बढ़ी। लेकिन ट्रैक्टरों की कमज़ोर मांग के कारण पावर सॉल्यूशंस का कारोबार स्थिर रहा। कंपनी का शुद्ध मुनाफा 41.4% बढ़ा, क्योंकि उसे एक बार का टैक्स क्रेडिट मिला। अगले साल धीमी बढ़त की उम्मीद है, क्योंकि चुनाव और पैसे की कमी से पहली तिमाही पर असर पड़ेगा, लेकिन दूसरी तिमाही से सुधार होगा। बारिश का अनियमित होना, तिपहिया वाहनों का छोटे ट्रकों पर असर और बदलाव की अनिश्चितताएँ जोखिम हैं। कंपनी लागत घटाने और स्थानीय उत्पादन पर ध्यान दे रही है।
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Read Transcript →Quarter Snapshot
Two-Wheeler Business Growth
17.6%
+17.6pp YoY
Two-wheeler division grew 17.6% in Q4 FY24 vs Q4 FY23, driven by higher demand and new product launches.
Mobility Aftermarket Growth
9.4%
+9.4pp YoY
Mobility Aftermarket grew 9.4% in Q4 FY24, driven by increased demand for spark plugs and diesel products.
Export Share
8.1%
flat YoY
Exports accounted for 8.1% of total net sales in FY24, with efforts to increase through localization.
Hydrogen ICE Truck Penetration by 2030
10-15%
N/A
Management expects 10-15% of new trucks sold by 2030 to use hydrogen ICE technology.
What Changed vs Last Quarter
NEW
CapEx to remain in INR 400-600 crore range
Annual capital expenditure is expected to continue in the range of INR 400-600 crore, supporting localization and other investments.
NEW
EGT localization SOP in April 2025
Start of production for localized exhaust gas treatment components is expected in April 2025.
NEW
Building Technologies divestiture expected by Q1/Q2 2025
The divestiture of the Building Technologies business is expected to be completed by Q1 or Q2 of 2025.
UPDATED
Moderate growth expected in FY25 with Q1 slow due to elections
Management expects moderate growth for FY25, with Q1 impacted by elections and liquidity crunch, but recovery from Q2 onwards.
DROPPED
Next quarter flat to small growth
Management indicated Q4 FY24 may be flat or see very small growth.
DROPPED
TREM V norms expected by 2026
Management expects TREM V norms for tractors to be implemented in 2026, with Bosch fully ready.
DROPPED
PLI disbursements expected in 2024
Management expects PLI benefits to start flowing in 2024 after audits on domestic value-add.
NEW RISK
Erratic monsoon and rural sentiment impact on tractor segment
Tractor sales declined 15% in Q4 FY24 due to erratic monsoon and low reservoir levels, which could continue to affect rural demand.
NEW RISK
Three-wheeler encroachment on sub-one-tonne LCV segment
Management noted the risk of three-wheelers encroaching on the sub-one-tonne LCV segment, which could pressure LCV growth.
NEW RISK
Portfolio realignment uncertainty and perception risk
Analyst raised concerns about related-party transactions and portfolio realignment creating negative perception; management acknowledged ongoing changes without clear timeline.
NEW RISK
Gross margins at 15-20 year low despite soft commodity prices
Analyst observed gross margins at multi-decade lows despite soft commodity prices, questioning whether localization benefits are materializing.
RISK GONE
Election-year uncertainty
National elections in 2024 may cause demand slowdown, as seen historically.
RISK GONE
Global headwinds and Red Sea logistics
Global economic slowdown and Red Sea disruptions could increase logistics costs and impact supply chains.
RISK GONE
Tractor demand weakness
Tractor volumes declined 13% YoY due to erratic rainfall; continued weakness could impact overall performance.
RISK GONE
Electrification margin pressure
Management acknowledged global electrification margins are low; Indian EV market may face similar pressure as penetration grows.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q2 FY24
Management guided CapEx of INR 3.5 billion for FY24, mainly for localization in Common Rail and exhaust gas treatment.
Mentioned in Q2 FY24, Q3 FY24
Management acknowledged global electrification margins are low; Indian EV market may face similar pressure as penetration grows.
Fast read
Guidance and risk preview
Management expects moderate growth for FY25, with Q1 impacted by elections and liquidity crunch, but recovery from Q2 onwards.
Tractor sales declined 15% in Q4 FY24 due to erratic monsoon and low reservoir levels, which could continue to affect rural demand.
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