Initiating Coverage | 21 September 2015
Sector: Automobiles
Bosch
Heart of vehicles
Jinesh Gandhi
(Jinesh@MotilalOswal.com);+91 22 3982 5416
Jay Shah
(Jay.Shah@MotilalOswal.com); +91 22 3078 4701

Bosch
BOSCH: Heart of vehicles
Investment summary............................................................................................
3
Bosch best proxy on Indian auto industry .............................................................. 5
Cyclical & structural drivers to drive strong growth ............................................... 9
Aftermarket business enjoys strong positioning .................................................. 20
Listed entity not present in key emerging trends ................................................. 24
Valuation and view............................................................................................. 27
Bosch| Key Operating Indicators ......................................................................... 29
Operating metrics............................................................................................... 30
Financials and valuations .................................................................................... 31
Investors are advised to refer through disclosures made at the end of the Research Report.
Motilal Oswal research is available on
www.motilaloswal.com/Institutional-Equities,
Bloomberg, Thomson Reuters, Factset and S&P Capital.
21 September 2015
2

Bosch
Initiating Coverage | Sector: Automobiles
Bosch
Buy
BSE Sensex
26,193
S&P CNX
7,977
CMP: INR21,585
TP: INR 26,864 (+24%)
Technology focus to drive 23% revenue CAGR
Unique industry positioning, technology focus makes it biggest
beneficiary of Indian auto industry’s evolution
Stock Info
Bloomberg
Equity Shares (m)
M.Cap(INR b)/(USD b)
1, 6, 12 Rel. Per (%)
Avg Val(INRm)/Vol‘000
Free float (%)
BOS IN
31.4
678/10.3
-6/-11/49
828/36
28.8
52-Week Range (INR) 27989/14200
BOS is the best proxy on the Indian automotive industry, addressing over 40% of
the Indian auto component industry.
The company has several cyclical and structural drivers in place to drive over 20%
revenue CAGR over the next 5-6 years.
BOS’s Aftermarket business network is India’s largest aftermarket network,
offering the widest product portfolio and having the largest independent service
network.
Unique industry positioning, technology focus enables high growth visibility as
reflected in ~34% FY15-18E EPS CAGR. Initiate with Buy and a target price of
~INR26,864 (35x FY18E Core EPS + ~INR2,356/share net cash).
Financial Snapshot (INR Billion)
Y/E MARCH
2015 2016E 2017E
Sales
120.9 113.1 142.0
EBITDA
NP
EPS (INR)
EPS Gr. (%)
BV/Sh.(INR)
RoE (%)
RoCE (%)
Valuations
P/E (x)
P/BV (x)
EV/EBITDA (x)
EV/Sales (x)
50.0
9.2
33.3
5.5
48.1
8.0
32.0
5.8
35.1
6.8
23.6
4.5
19.8
13.6
20.4
14.1
27.3
19.3
Best proxy on Indian auto industry, with limited competitive intensity
432.1 448.3 615.3
65.2
3.8 37.2
2,339 2,685 3,158
8
0
8
19.9 17.8 21.1
28.7
26.4
29.8
BOS is the best proxy on the Indian automotive industry, offering exposure
across all auto segments and enjoying market leadership in almost all the
key business segments.
The company accounts for over 40% of the Indian auto component industry
and enjoys ~4.5% market share of the same.
In the Powertrain segment (~70% of revenues), BOS enjoys market
leadership (~70% market share of the diesel engine segment).
Bosch Group in India enjoys significant head start vis-à-vis its global peers,
as reflected in almost six-fold lead in revenues over its nearest global
competitor in India.
BOS biggest beneficiary of India auto industry’s technological evolution
Shareholding pattern (%)
As on
Jun-15 Mar-15 Jun-14
Promoter
71.2
71.2
71.2
DII
10.7
10.5
11.5
FII
8.8
9.3
7.4
Others
9.3
9.0
9.9
FII Includes depository receipts
Stock Performance (1-year)
Cyclical recovery in CVs and PVs, coupled with BS-IV compliance across India
by April 2017, would drive ~23% revenue CAGR (FY15-18) for BOS.
Adoption of Gasoline Direct Injection (GDI) engines would get a boost from
impending Corporate Average Fuel Economy (CAFE) norms in India from
2017. Our analysis indicates over INR11b market size for GDI engines by
FY20.
BOS has developed an affordable engine management system based on fuel
injection for two-wheelers. We estimate Electronic Fuel Injection (EFIs) for
2Ws to be ~INR60b market by FY20 and ~INR118b by FY22.
Implementation of BS-V (from April 2019) and BS-VI (April 2023) would
increase potential market size by ~INR98b in FY20 for BS-V and ~INR118b in
FY24 for BS-VI.
21 September 2015
3

Bosch
Automotive aftermarket and non-auto businesses to supplement strong
growth in core business
BOS’s aftermarket business operates India’s largest aftermarket network,
offering the widest product portfolio and also having the largest independent
service network.
BOS’s Automotive Aftermarket division should witness strong growth of over
~19% CAGR, driven by a) new product launches, b) increased use of electronics,
c) increased technological intensity and d) increased preference for authorized
services.
While non-auto business contributes ~12% to BOS's overall revenues, global
non-auto business’ contribution is ~42% of overall revenues.
Listed entity not present in key emerging trends
The Bosch Group operates in India through nine companies, including Bosch
Limited. Importantly, Bosch’s unlisted companies are present in emerging
drivers like safety, connectivity and electrification of powertrains (partly in BOS),
and have witnessed ~23% CAGR in the last five years v/s 15% CAGR for BOS.
Global modular platforms and technology upgrade in India pose key challenges
to BOS’s dominance in the powertrain business. While Bosch is the most
dominant player globally in the Powertrain segment (~36% market share), other
players like Denso (~31% share) and Continental (~21% share) are not far
behind.
Strong industry positioning, technology focus enables high growth visibility;
initiate with Buy
BOS has several levers to drive over 20% CAGR in revenues over the next 5-6
years (~23% CAGR over FY15-18), as BOS is at forefront of technological
evolution of the Indian auto industry. This would translate into ~34% EPS CAGR
over FY15-18 (on the back of flat EPS over CY11-14).
The stock trades at 35.1/25.9x FY17E/18E EPS, 23.6/17.8x FY17E/18E EV/EBITDA
and 6.8/5.7x FY17/18 P/BV.
BOS premium valuations vis-à-vis its auto component peers is manifestation of
very strong and unique industry positioning as reflected in lower cyclicality in
operating performance, stronger long term growth outlook and superior capital
efficiencies.
We initiate with
Buy,
with a target price of ~INR26,864 (35x FY18E Core EPS +
~INR2,356/share net cash).
21 September 2015
4

Bosch
Bosch best proxy on Indian auto industry
Strong industry positioning in segments with limited competition
BOS is the best proxy on the Indian automotive industry, offering exposure across all
auto segments and enjoying market leadership in almost all the key business
segments.
More importantly, as compared to its peers in auto components segment, BOS enjoys
very strong positioning driven by focus on technology.
While BOS revenues are highly correlated with auto industry volumes, it exhibits
relatively less volatility than the industry.
BOS addresses over 40% of the Indian auto component industry and enjoys ~4.5%
market share of the same. More importantly, the company has outperformed the
domestic industry in the last five years, reflecting its technological edge.
Given BOS’s technological focus, it has consistently enjoyed superior margin profile
than the auto industry.
BOS derives over 85% of its revenues from the Automotive segment, with Powertrain
segment contributing ~70% to its revenues. In the Powertrain segment, it enjoys
market leadership (~70% market share of the diesel engine segment).
BOS caters to well-diversified sub-segments of autos, with CVs contributing ~54% to
revenue. Although 2Ws currently don’t contribute meaningfully, we expect their
contribution to increase meaningfully over the next few years— driven by increasing
penetration of fuel injection systems.
Bosch Group in India enjoys a significant head start vis-à-vis global peers, as reflected
in almost six-fold lead in revenues over its nearest global competitor in India.
Exhibit 1: BOS - Industry positioning very strong *
Technology intensity
Scope for increase in content per vehicle
Product criticality
Customer stickiness
Aftermarket contribution
Export Contribution
Capex intensity
Average Ranking
* Score on scale of 5, with 5 being highest
BOS
5
5
5
5
2
2
3
3.9
BHFC
3
3
4
4
0
5
2
3.0
EXID/AMRJ
2
1
3
3
3
1
5
2.6
APTY
2
2
3
2
5
2
2
2.6
Wabco (WIL)
5
3
5
4
2
3
4
3.7
MSS
3
4
4
3
0
2
4
2.9
Source: MOSL
Exhibit 2: BOS enjoys very strong industry positioning…
Industry Positioning
BOS
3.9
2.9
3.0
BHFC
Exhibit 3: …as manifested in financial positioning
Financial Positioning
BOS
4.2
3.3
BHFC
MSS
MSS 4.2
WIL3.7
2.6
APTY
2.6
AMRJ
WIL 4.5
1.7
4.2 AMRJ
APTY
Source: ACMA, MOSL
Source: ACMA, Company, MOSL
21 September 2015
5

Bosch
Exhibit 4: BOS enjoys strong industry positioning, with equally superior positioning on financial parameters
MSS
WIL
5
0
APTY
BOS
BHFC
AMRJ
#1: Technology intensity and innovation
Technological intensity and innovation acts as an economic moat, as it provides solution to
OEMs rather than just a product. Typically, OEMs has multiple source for a product supplier,
whereas single source for solution provider.
BOS’s product portfolio has relatively higher technology intensity due to focus on innovation.
In fact, BOS’s R&D spend at ~1.5% of sales is far higher than other listed Auto Component
players.
#2: Scope for increase in content per car
Ability to benefit from increasing content per vehicle is an off-shot of investment in R&D, and
would drive higher than industry growth due to higher value add.
BOS has significant scope to increase content per car through offering more technological
intense solutions for meeting future emission norms and innovative solutions for improving
fuel efficiencies.
#3: Product criticality and Customer stickiness
Criticality of product plays key role in stickiness of customer. For critical products (like fuel
injection systems, engine parts etc), OEMs would tend to rely on a single source supplier,
whereas there could be multiple suppliers for other components (for eg. bought out
components like batteries, tyres etc).
Large part of BOS revenues is derived from engine components, where it is single source
supplier and enjoys very strong relationships with OEMs.
#4: Aftermarket contribution
Aftermarket provides secular growth opportunity, as installed population of vehicle continues
to increase. Brand equity plays a critical part, enabling pricing power and higher margins.
While BOS operates one of the largest aftermarket network in India offering widest product
portfolio, aftermarket business contributes only ~20% to revenues.
#5: Export Contribution
Leveraging on India cost structure, global OEMs are making India as sourcing hub for their
global requirements, providing additional growth avenue for Auto Component players.
As compared to its listed auto component peers, BOS is relatively less focused on export
markets due to global presence of the parent. Exports contribute ~12.5% of overall revenues.
#6: Financial Positioning
BOS’s superior industry positioning is reflected in its top-quartile financial positioning as well.
While several of BOS’s peers (likes of Wabco, AMRJ and MSSL) exhibit equally strong financial
positioning, consistency of BOS’s performance across cycle and longevity/visibility of
sustenance of superior financial performance differentiates BOS from its peers.
Source: MOSL
MSS
WIL
5
0
BOS
BHFC
AMRJ
BOS
BHFC
AMRJ
APTY
APTY
MSS
WIL
5
0
MSS
WIL
5
0
BOS
BHFC
AMRJ
APTY
MSS
WIL
5
0
BOS
BHFC
AMRJ
APTY
5.0
MSS
0.0
WIL
BOS
BHFC
AMRJ
APTY
Exhibit 5: BOS’s revenue growth highly correlated to auto industry volumes
BOS Net Sales Growth (%)
40
30
20
10
0
CY03 CY04 CY05 CY06 CY07 CY08 CY09 CY10 CY11 CY12 CY13 CY14
Source: Company, MOSL
Auto Industry Volume Growth (%) - R.H.S.
30
20
10
0
-10
21 September 2015
6

Bosch
Exhibit 6: Bosch addresses over 40% of the Indian auto Exhibit 7: Bosch’s market share of the domestic auto
component industry
component industry has been increasing (%)
Others, 7
Electrical
Parts, 9
Equipments,
10
Suspension &
Braking Parts,
12
Body &
Chassis, 12
Engine Parts,
31
BOS Market Share of Dom. Auto Comp. Industry (%)
4.0
4.2
4.5
4.5
3.1
3.3
Drive
Transmission
& Steering
Parts, 19
Source: ACMA, MOSL
CY09
CY10
CY11
CY12
CY13
CY14
Source: ACMA, Company, MOSL
Exhibit 8: BOS has outperformed the domestic auto ancillary
industry in recent past
Exhibit 9: BOS enjoys better margins than the auto industry
BOS Net Sales Growth (%)
Auto Ancs ind. Dom. Sales Growth (%)
22
17
12
7
BOS EBITDA Margins (%)
Auto Ind - EBITDA Margins *
60
40
20
0
-20
Source: Company, MOSL
* Weighted average margins for 8 OEMs in MOSL Auto Universe
Source: Company, MOSL
Exhibit 10: Over 85% of BOS’s revenues is from Autos
Autos
10.1
9.6
Industrial
10.8
12.1
12.1
Exhibit 11: ~70% of BOS’ revenues from the Powertrain
segment
Fuel Injection Equipment
Starters & Generators
Others
10
10
12
13
6
7
7
8
7
8
11
12
23
23
23
23
53
CY10
52
CY11
47
CY12
44
CY13
Injectors & Nozzles
Power tools
15
8
12
26
39
15
7
11
26
40
15
7
10
27
40
15
6
10
29
41
89.9
90.4
89.2
87.9
87.9
CY10
CY11
CY12
CY13
FY15 (15m)
FY15 FY16E FY17E FY18E
(15m)
Source: Company, MOSL
Source: Company, MOSL
21 September 2015
7

Bosch
Exhibit 12: BOS enjoys a lion share of diesel powertrain Exhibit 13: Bosch Group’s India revenue almost 6x of its
business in India
nearest global competitor
Diesel
Others
30%
153
Bosch
70%
Bosch
Source: MOSL
26
18
Delphi
10
Continental
Auto
Source: MOSL
Denso
Exhibit 14: CVs contribute over 50% of BOS’s revenues
Non-Autos
12%
Tractors
20%
PVs
14%
CVs
54%
Source: MOSL
21 September 2015
8

Bosch
Cyclical & structural drivers to drive strong growth
Biggest beneficiary of Indian auto industry’s technological evolution
Cyclical recovery in CVs and PVs, coupled with BS-IV compliance on pan-India basis by
April 2017, would drive ~23% revenue CAGR (FY15-18) for BOS.
Adoption of Gasoline Direct Injection (GDI) engines would get a boost from impending
Corporate Average Fuel Economy (CAFE) norms in India from 2017. Our analysis
indicates over INR111b market size for GDI engines by FY20.
BOS has developed an affordable engine management system based on fuel injection
for two-wheelers. We estimate EFIs for 2Ws to be ~INR60b market by FY20 and
~INR118b by FY22.
BOS’s eClutch, add-on to the existing manual transmission system, not only improves
fuel economy (~10%) and emissions but also performance and comfort. We
conservatively estimate eClutch market size at ~INR3b by FY20.
Implementation of BS-V (from April 2019) and BS-VI (April 2023) would increase
market size by ~INR98b in FY20 for BS-V and ~INR118b in FY24 for BS-VI.
Exhibit 15: Several levers to drive over 20% revenue CAGR for BOS over long term
98
51
20
Cyclical
recovery
FY16-17
BS-IV
FY16-17
3
11
BS-V
FY20
EFI for 2Ws
FY22
BS-VI
FY24
Source: MOSL
118
118
E-Clutch GDI for PVs
FY20
FY20
Medium-term Driver # 1: Cyclical recovery in both CVs and PVs
We expect sharp recovery in the Indian automobile industry—~13% CAGR in
volumes over FY15-18 compared with just ~5% CAGR over FY12-15.
More importantly, we estimate strong recovery in volumes for PVs (15% CAGR)
and CVs (23% CAGR)— the key segments for BOS.
As a result, we estimate BOS’s revenues to witness ~23% CAGR over FY15-18 on
the back of ~6% revenue CAGR over CY11-14.
Exhibit 16: BOS would benefit from cyclical recovery in CVs and PVs
BOS Net Sales Growth (%)
38
26
14
2
-10
Auto Industry Volume Growth (%) - R.H.S.
Source: Company, MOSL
21 September 2015
9

Bosch
Medium-term Driver # 2: Implementation of BS-IV on pan-India basis offers over
INR50b opportunity annually
In April 2010, BS-IV (Euro-4) was introduced in Delhi NCR and 13 other cities.
However, all other cities are still on BS-III. While PVs in the 13 cities moved to
BS-IV engines, majority of the CVs are still running on BS-III (though graduated
from BS-II to BS-III from April 2010).
In CY10, as emission norms were transited to BS-III, BOS’s revenues grew
~40%— driven by strong growth of over 45% in powertrain systems and aided
by a sharp recovery post the global financial crisis.
However, the government has announced that BS-IV would be mandatory in
phased manner on pan-India basis by March 2017; this would give an impetus to
BOS’s powertrain business—especially in the CV segment, where it enjoys ~70%
market share.
Almost all PVs sold in India are already BS-IV compliant, and wouldn’t require
any incremental changes.
While transition from BS-III to BS-IV will have multiple approaches, we believe
shift from rotary pumps to common-rail diesel injection (CRDi) would remain the
dominant approach.
Based on our industry interaction and estimates, we believe the shift to CRDi
would increase cost by up to INR35,000/unit for LCVs, ~INR70,000-100,000/unit
for MCVs, and INR130,000-200,000 for HCVs.
Our estimates indicate incremental annual market size of over ~INR50b, driven
by shift to BS-IV for CVs (based on FY17E volumes); at current market share of
BOS, it implies incremental revenues of ~INR35b.
Exhibit 17: India Emission Standards: Timeline
Regions
Metros
NCR+10 Ci ti es
NCR+13 Ci ti es
J&K (except Leh a nd
Ka rgi l di s tri cts ), Punja b,
Ha rya na , HP, UTK a nd
mos t di s tri cts of
Ra ja s tha n a nd UP
Odi s ha , Kera l a ,
Ka rna ta ka , Tel a nga na ,
Uni on Terri tori es of
Da ma n a nd Di u, Da dra
a nd Na ga r Ha vel i a nd
Anda ma n a nd Ni coba r
Is l a nds
Pan India
00
01
02
03
04
05
06
07
BS-III
08
09
10
11
12
13
14
BS-IV
15
16
17
18
BS-II
BS-II
BS-IV (Oct-15)
BS-I
BS-I
BS-I
BS-II
BS-III
BS-IV (Apr-
16)
BS-IV
Source: MOSL, Company
21 September 2015
10

Bosch
Exhibit 18: Implementation of stricter emission norms augurs well for BOS
BS-II
implementation
22
23
28
27
14
6
5
6
1
BS-II
Iimplementation
39
22
11
26
17
27
CY03 CY04 CY05 CY06 CY07 CY08 CY09 CY10 CY11 CY12 CY13 CY14 CY15ECY16ECY17E
Source: ICCT, MOSL
Exhibit 19: Common Rail is expected to be the dominant technology for CVs for emission
compliance
Source: Delphi, MOSL
Exhibit 20: Current pricing for BS-IV options gives some insight on potential benefit for BOS
Model (INR '000)
LCVs/ SCVs
Winger 28 Standard 9+D
Winger 28 School 13+D
Xenon PU SC
ACE FL
ACE HT FL
Force T1 (HR) 3050WB (9+D)
MCVs
LPT-407 EX2/34WB
Eicher VECV 10.50 2750MM/CBB
Eicher VECV 11.10HD 4300 MM/CBC
Buses
TATA Starbus 32+1S -LP712/42
TATA LP-712 EX/42, FES
TATA LP-912 EX/4920WB, FES
Eicher Starline 10.75 School Bus (27+1+1)
Eicher Starline 10.90 School Bus (39+1+1)
BS-III
777
764
617
414
400
878
909
727
1,116
1,545
945
1,003
1,099
1,415
BS-IV
831
805
623
423
409
1,033
1,065
805
1,194
1,647
1,044
1,181
1,213
1,543
Diff excl
indirect tax &
Difference OE margins Remarks
54
41
6
10
9
154
156
78
78
102
100
178
114
129
36
27
4
6
6
103
104
52
52
68
66
119
76
86
TD 2200 CRDi engine in BSIV
E483 Turbo Charged Intercooled CRDI
for BS IV
Turbo charged inter cooled for BSIV
Turbo charged inter-cooler CRDi for BSIV
E483 Turbo Charged Intercooled CRDI
for BS IV
Source: Industry, MOSL
21 September 2015
11

Bosch
Exhibit 21: BS-IV offers incremental market size of over INR50b p.a
Segment
LCVs
MCVs
HCVs
Total
FY17 volumes
('000)
571
167
196
934
Incremental cost
(INR/unit)
15,000
80,000
150,000
54,934
Incremental Mkt Size
(INR b)
8.6
13.4
29.4
51.4
Source: Industry, MOSL
Long-term Driver # 1: Gasoline Direct Injection for PVs—best of gasoline and
diesel!
Gasoline Direct Injection (GDI) is a process whereby fuel is injected straight into
the combustion chamber at high pressure; this is an effective means of reducing
fuel consumption and emissions on one hand and greatly boosting driving
dynamics on the other.
Improvement in fuel efficiency and emission of up to 20% can be achieved with
a combination of downsizing and turbocharging.
The proliferation of statutory fuel consumption requirements and ever-
increasing stringent emission regulations are leading to rapid growth in vehicles
featuring gasoline direct injection. GDI installation rate in developed markets
currently varies from 30% (NAFTA) to 57% (Europe).
Among the mainstream vehicles in India, Ford Ecosport is the first vehicle to
offer GDI (supplied by Bosch Ltd)—the vehicle’s 1ltr GDI engine (v/s 1.5ltr
conventional engine) offers ~20% better mileage (~18.9kmpl as per ARAI
standards) and 22% higher torque, at a 6% price premium.
Impending Corporate Average Fuel Economy (CAFE) norms in India from 2017
would act as key catalyst for adoption of GDI on gasoline engines.
Our analysis indicates over INR11b market size for GDI engines by FY20.
Exhibit 22: GDI offers best of both fuels—lower fuel consumption & emission coupled with enhanced driving dynamics
Source: Industry, MOSL
21 September 2015
12

Bosch
Exhibit 23: Global GDI revenues are estimated to grow at 17-20% CAGR
Source: Continental, Delphi, MOSL
Exhibit 24: GDI engine can be an over INR11b market by FY20
Segment ('000 units)
Domestic Cars
Domestic UVs
Total Domestic PVs (ex MPVs)
- of which Petrol
Cars @ 65% Petrol
UVs @ 20% Petrol
Total Petrol - (A)
- Compact segment (Swift) & above: Petrol - (B)
GDI Installation rate (C)
GDI Engine Volumes (D = BxC)
GDI incremental cost (INR/unit) (E)
GDI Market Size (INR b)
(DxE)
FY18
2,873
1,110
3,983
1,867
222
2,089
1,432
5%
72
26,220
1.9
FY19
3,218
1,244
4,461
2,091
249
2,340
1,604
15%
241
23,598
5.7
FY20
3,604
1,393
4,997
2,342
279
2,621
1,797
30%
539
21,238
11.4
Source: MOSL
Long Term Driver # 2: Electronic Fuel Injection for 2Ws—to drive up to 16% fuel
efficiency improvement
Bosch has developed an affordable engine management system based on fuel
injection, which is specially designed for the Indian and Asian markets.
Currently, almost all 2Ws sold in India are carburetor based. BOS has very
miniscule revenue contribution coming from 2W segment currently.
Compared with the mechanically controlled carburetor, the electronically
controlled fuel injection system can reduce fuel consumption by up to 16% and
has much lower emissions.
The Electronic Fuel Injection also opens opportunities for two-wheeler
connectivity functions, including smartphone connectivity.
According to Bosch estimates, of the ~27m 2Ws sold in 2020, 15m-20m would
feature modern engine management technology will be sold in India in 2020.
The company is targeting to offer its electronically controlled solution for single-
cylinder engines at about the same price as a standard carburetor version.
BOS’s recently commissioned facility at Gangaikondan would focus on to enter
in EFI system for 2Ws.
While we believe stricter emission norms would be the key catalyst for 2Ws’
shift to EFI from carburetor-based engines, BOS is working toward earlier and
faster adoption of EFIs by demonstrating its cost benefits.
21 September 2015
13

Bosch
We estimate EFIs to be ~INR60b market by FY20 (based on 8.6m EFI engines;
based on BOS estimate of 15m-20m EFI engines by 2020, market size could be
INR110b-140b by FY20) and ~INR118b by FY22 (~16.7m EFI engines).
BOS would face competition from the JV between Hero MotoCorp and Magneti
Marelli (focused on EFIs), apart from its other global competitors.
Exhibit 25: Bosch injection system for two-wheelers
Source: Company, MOSL
Exhibit 26: Bosch components for small motorcycles
Source: Company, MOSL
21 September 2015
14

Bosch
Exhibit 27: EFI for 2Ws can be ~INR118b market by FY22
Segment ('000 units)
Total Domestic 2Ws
EFI Installation rate
EFI volumes
EFI cost (INR/unit)
EFI Market Size (INR b)
FY17
19,868
5%
993
7,500
7.5
FY18
22,848
10%
2,285
7,268
16.6
FY19
25,590
20%
5,118
7,413
37.9
FY20
28,661
30%
8,598
7,042
60.5
FY21
FY22
30,953
33,430
40%
50%
12,381
16,715
7,042
7,042
87.2
117.7
Source: MOSL
Long-term Driver # 3: e-Clutch for PVs—a cost-effective solution to increase driving
comfort
BOS’s eClutch is an add-on to the existing manual transmission system, allowing
transmission to first gear without using the clutch.
E-Clutch not only improves fuel economy (~10%) and emissions, but also
performance and comfort.
The add-on cost of e-clutch is less than AMT, and can be applied to all PVs.
There is also potential for extending it to light commercial vehicles and retrofit.
The success of the AMT transmission has encouraged Bosch to engage in talks
with several OEMs to adopt the e-clutch system since its benefits outweigh that
of AMT. As per media articles, Tata Motors’ upcoming Kite hatchback (in CY16)
would be the first car to offer e-clutch.
Our analysis indicates market size for e-clutch at over ~INR3b by FY20.
Exhibit 28: BOS’s eClutch saves fuel and makes driving easier, and narrows the gap
between manual and automatic transmission in a cost-efficient manner
Source: Delphi, MOSL
21 September 2015
15

Bosch
Exhibit 29: E-Clutch can be an over INR3b market by FY20
Segment ('000 units)
Total Domestic PVs (ex MPVs)
e-Clutch Installation rate
e-Clutch volumes
e-Clutch cost (INR/unit)
e-Clutch Market Size (INR b)
FY17
3,376
1%
34
8,250
0.3
FY18
3,983
3%
100
7,425
0.7
FY19
4,461
5%
223
6,683
1.5
FY20
4,997
10%
500
6,683
3.3
Source: MOSL
Long-term Driver # 4: Implementation of stricter emission norms
While implementation of BS-IV on pan-India basis has been delayed, the
government is urging automobile industry to implement BS-V by 2019 and BS-VI
by 2023.
For diesel PVs, shift from BS-IV to BS-V is estimated to cost ~INR16,500/unit and
~INR20,000/unit for BS-V to BS-VI shift.
For LCVs, we estimate the cost at ~INR17,500/unit for both BS-V and BS-VI; for
MCVs, the estimate is ~INR75,000/unit for BS-V and ~INR50,000 for BS-VI.
For HCVs, BS-V compliance cost would be ~INR100,000/unit and
~INR75,000/unit for BS-VI.
Compliance cost for BS-V and BS-VI would not be very significant in case of
petrol-powered PVs and, hence, not included here.
Our analysis indicates potential market size increase due to BS-V compliance at
~INR98b in FY20 and BS-VI compliance at ~INR118b in FY24.
Exhibit 30: BS-V compliance would result in incremental opportunity of ~INR98b
Segment
PVs - Diesel
LCVs
MCVs
HCVs
Total
FY20 volumes
('000)
2,376
803
235
275
3,689
Incremental cost Incremental Mkt Size
(INR/unit)
(INR b)
16,500
39
17,500
14
75,000
18
100,000
28
26,674
98
Source: Industry, MOSL
Exhibit 31: Compliance to stringent emission norms to result in significant cost increase for
diesel vehicles
Source: ICCT, MOSL
21 September 2015
16

Bosch
Exhibit 32: Compliance to BS-V & beyond would require adoption of new generation
technologies…
Source: Frost & Sullivan, MOSL
Exhibit 33: ...like faster adoption of turbochargers…
Source: Continental, MOSL
21 September 2015
17

Bosch
Exhibit 34: ...and installation of SCR for NOx reduction
Source: Continental, MOSL
"In-car connectivity will
bring more value to
customers in terms of
diagnostics information and
reducing time of servicing,"
says CV Raman, executive
director, engineering,
Maruti Suzuki.
Long-term Driver # 4: In-vehicle infotainment
In-vehicle infotainment (IVI) is no longer limited to luxury vehicles. Today, the
entry level and medium-range vehicles are providing IVI panels; this includes
navigation systems and wireless connectivity.
Vehicle infotainment is a key differentiator in consumer sales, including in-car
connectivity, entertainment, navigation and telematics.
Indian carmakers are still playing catch-up. As per the industry experts, the
number of cars in India with even basic connectivity today is only 1.4% and is
expected to increase to ~2.5% by 2020.
Considering the price consciousness nature of consumers in India, a connected
car will increase cost by INR5,000-10,000 and infotainment and diagnostics by
INR25,000-50,000.
Although Bosch has a mere 4% market share in global infotainment systems
(including aftermarket supplies), faster adoption of OE-fitted infotainment
system augurs well for BOS— considering its strong relations with OEMs in India.
Exhibit 35: Bosch’s global share of automotive infotainment systems stands at ~4%
2012 Rank
1
2
3
4
5
6
7
8
9
10
Company
Panasonic
Pioneer
Harman International
Continental
Alpine/Alps Electric
Denso
Fujitsu-Ten
Garmin
Kenwood
Bosch
Top 10 Total
Others
YoY Change (%)
15
13.1
1.5
6
2.8
5
-1.9
-6.2
-1
4
5.3
4.8
Market Share (%)
12.1
9.8
9.4
7.9
7.6
5.4
5
4.5
3.6
3.4
65.4
34.6
Source: IHS Automotive, MOSL
21 September 2015
18

Bosch
Exhibit 36: IHS forecast for worldwide OEM telematics sales shows significant growth from
2014 through 2019
Source: IHS Automotive, MOSL
Exhibit 37: Asia-Pacific would see significant adoption of connected automotive
infotainment system
Source: ABI Research, MOSL
21 September 2015
19

Bosch
Aftermarket business enjoys strong positioning
Non-auto business scale-up dependent on investment cycle recovery
BOS Aftermarket business operates India’s largest aftermarket network, offering the
widest product portfolio and also having the largest independent service network.
BOS’s Automotive Aftermarket division should witness strong growth of over ~19%
CAGR, driven by a) new products introduction, b) increased use of electronics, c)
increased technological intensity and d) increased preference for authorized services.
While non-auto business contributes ~12% to BOS's overall revenues, global non-auto
business’ contribution is ~42% of overall revenues.
Non-auto business is expected to benefit from the impending recovery in economic
activity, especially in Power Tools and Energy & Building Technology divisions.
Aftermarket: The largest aftermarket network, offering the widest product
portfolio
Bosch’s Automotive Aftermarket division is responsible for the supply, sales and
distribution of all Bosch-branded automotive parts in India and the SAARC
region. The product range offered is the largest under one brand in India and
finds extensive application in 2Ws, 3Ws, cars, MUVs, LCVs, HCVs, buses,
tractors, off-road applications and stationary engines.
The Bosch automotive aftermarket distribution network is the largest in India,
with over 1,000 authorized distributors, over 3,000 authorized workshops and
direct distribution reach beyond 60,000 semi-wholesale and retail points with
presence in all the key markets.
The products marketed by the aftermarkets division include diesel and gasoline
fuel injection system & components, alternators, starter motors, spark plugs,
automotive filters, automotive batteries, automotive belts, wiper blades, horns,
lighting, automotive lubricants, 2- & 3-wheeler clutch plates, diagnostic
equipment, and automotive software.
In the OE aftermarket business, it is gaining market share in three product
groups—spark plugs, filtration, and automotive service solutions.
In addition, it is responsible for Bosch service workshop concepts for vehicle
service and maintenance. It manages the largest independent service network in
India with over 3,000 workshops/ service network comprising over 500 Bosch
Car Service, 1,000 Bosch Diesel Service Centers, 600 Electric Modules, 250
Express Car Service and 150 Express Bike Service in India, covering ~1,200 cities.
In the wake of increasing electronic control unit (ECU) based commercial
vehicles, it plans to extend the Bosch Workshop concept to the truck segment
with an Express Truck Service.
BOS’s Automotive Aftermarket division should witness strong growth, driven by
a) new products introduction, b) increased use of electronics, c) increased
technological intensity and d) increased preference for authorized services.
We estimate BOS’s automotive aftermarket business to grow at ~19% CAGR
(FY15-18), and contribute ~20% to overall revenues.
21 September 2015
20

Bosch
Exhibit 38: BOS’s auto aftermarket revenues to grow at ~19%
CAGR over FY15-18…
Exhibit 39: …contributing ~20% to overall revenues
Automotive Aftermarket (INR M)
Growth (%) - RHS
30
20
10
0
CY08 CY09 CY10 CY11 CY12 CY13 CY14 FY16E FY17E FY18E
Source: Company, MOSL
Source: Company, MOSL
23
Auto Aftermarket (% of net sales)
26
23
21
22
22
21
21
20
18
Exhibit 40: BOS offerings in aftermarket can be broadly classified into three segments
Source: Company, MOSL
Non-autos—currently a small contribution, but potential to scale up exists
BOS’s non-auto business consists of three broad categories: Packaging
Technology, Power Tools and Energy & Building Technology.
While non-auto business contributes ~12% to BOS’s overall revenues, global
non-auto business’ contribution is ~42%.
Non-auto business is expected to benefit from the impending recovery in the
economic activity, especially in Power Tools and Energy & Building Technology
divisions.
We estimate over 15% CAGR (FY15-18) for BOS’s non-auto business.
21 September 2015
21

Bosch
Exhibit 41: BOS's non-auto business structure
Non-Auto
Industrial
Technology
Consumer Goods
(Power Tools)
Energy & Building
Technology
Packaging
Technology
Security Technology
Industrial
Equipment
Bosch Energy &
Building Solutions
Thermotechnology
Source: Company, MOSL
Exhibit 42: Bosch generates over 40% of its revenues from Exhibit 43: Bosch’s global non-auto business well diversified
non-auto business globally, as against ~12% in India
(% of overall sales)
Mobility Solutions (Auto)
12%
42%
88%
58%
Consumer
Goods
24%
Source: Company, MOSL
Non-Auto
Energy &
Building
Technology
7%
Industrial
Tech
11%
BOS
Bosch Global
Source: Company, MOSL
Exhibit 44: BOS’s non-auto revenues estimated to witness over 15% CAGR
Non-Auto Revenues
12.8
% of net revenues
12.3
11.9
11.6
11.5
10.8
10.1
9.6
CY10
CY11
CY12
CY13
CY14
FY16E
FY17E
FY18E
Source: Company, MOSL
1. Packaging Technology—the parent enjoys global leadership in packaging
solutions
Globally, Bosch Packaging Technology is either in the leading position or one of
the three top players in all relevant markets; these include the key sectors of
solid and liquid pharma and food as well as confectionery and areas of the
beverage industry.
21 September 2015
22

Bosch
It offers tailor-made packaging solutions for the Indian market. It unit designs,
manufactures and markets ‘form, fill and seal machines’ for flexible pouch
packing, flow wrap machines for pillow-packed candy applications and liquid
pharmaceuticals products.
The two business units of food confectioneries and pharmaceutical machines
form the core of Bosch Packaging in India.
The division has service outlets across India, extending service and engineering
support.
2. Power Tools—market leader; awaiting investment cycle recovery
BOS’s Power Tool division enjoys market leadership in India, and offers a
complete range of power tools for construction, woodworking and
metalworking industries.
BOS has also introduced tools for DIY (Do-It-Yourself) enthusiasts; recent
inclusions to the range are gardening and hobby tools
BOS is leveraging e-commerce and modern retail channels to reach the new and
upcoming user base, focusing on the urban and home user segments.
The premium retail store concept—Bosch System Specialist (BSS)—has carved a
niche in the market with its positioning as a total solutions provider for power
tools.
3. Energy & Building Technology—high on potential
a.
Security Technology:
Bosch Security Systems offers state-of-the-art safety,
surveillance, and communication solutions. It has successfully served several
prominent ventures including metro rail projects, airport security, city and
market surveillance, and traffic management across cities. As the country’s
infrastructure development gathers pace and investment cycle revives, we
expect growing demand for high-end security and communication solutions as
well as affordable products for the price-conscious market.
b.
Bosch Energy & Building Solutions (BEBS):
BOS’s BEBS division is a 'full-line
solution provider'—offering products, solutions and services—and the
headquarter of Bosch Energy and Building Solutions in Asia Pacific, responsible
for Middle East and Asia. The division is empanelled as the highest-rated
channel partner for Ministry of New & Renewable Energy (MNRE). Further, it
has already been accredited as a Grade ‘one’ energy services company by the
Bureau of Energy Services (BEE) and will provide solutions for energy
generation and conservation; the solutions can be for hot water, steam and
power using renewable energy. The division has introduced patented
technology for heating, ventilation, and air conditioning (HVAC) system that
reduces energy costs by 30% and improves air quality. It also offers end-to-end
solutions for engineering and construction of a solar power plant, and
undertakes operation and maintenance contracts.
c.
Thermotechnology:
Bosch started its Thermotechnology division in India in
2012, and mainly markets various series of water-tube/fire-tube industrial
boiler, solar water heater, and gas water heater. Within two years, it has spread
its dealer network across India (more than 70 dealers currently) and is looking
aggressively to enhance its dealer base. The division is empanelled as a channel
partner with the government of India.
21 September 2015
23

Bosch
Listed entity not present in key emerging trends
Technology upgrade and reversal of dieselization pose challenges
The Bosch Group operates in India through nine companies, including Bosch Limited.
Importantly, Bosch’s unlisted companies are present in emerging drivers like safety,
connectivity and electrification of powertrains (partly in BOS), and have witnessed
~23% CAGR in the last five years v/s 15% for BOS.
Global modular platforms and technology upgrade in India pose key challenges to
BOS’s dominance in the powertrain business.
With increasing focus on global modular platform, ~60% of light vehicle production by
2021 is expected to be built on global platforms (source: HIS Automotive). The trend
includes a shift to a more modular architecture and standardized components across
vehicles sold globally, and augurs well for BOS’s global competitors.
Bosch is the most dominant player globally in the Powertrain segment, with ~36%
market share; however, other players like Denso (~31% share) and Continental (~21%
share) are not far behind.
Technological upgrade to meet stricter emission norms would provide opportunity to
BOS’s global competitors to improve their competitive positioning in the powertrain
business in India.
Further, reversal of the dieselization trend for PVs (due to correcting fuel price
disparity) hurts BOS due to its over 70% share in diesel powertrain.
Exhibit 45: Apart from BOS, Bosch has another eight companies in India and contributes over 35% to India revenues
Company
Segment
Product
Gasoline Systems
Diesel Systems
Starter Motors and Generators
Automotive Aftermarkets
Car Multimedia
Packaging Technology
Power Tools
Security Technology
Energy and Building Solutions and Thermo Technology
Braking and vehicle safety systems (ABS, ESP, Driver
Assistance System, Passive Safety System etc)
Automotive Electronics (ECU, Body Computer Module,
Immobilizer etc)
Automotive Steering
Electrical Drives
Embedded Systems
Drive and Control Technology
Engineering and IT services
Household Appliance
Source: Company, MOSL
Mobility Solutions
Bosch Limited
Industrial Technology
Consumer Goods
Energy & Building Tech
Energy & Building Tech
Bosch Chassis Systems India Ltd
Bosch Automotive Electronics
Robert Bosch Automotive Steering GmbH
Bosch Electrical Drives India Private Ltd
ETAS Automotive India Pvt. Ltd
Bosch Rexroth India Ltd
Robert Bosch Engineering & Business Solutions Ltd
BSH Home Appliances Pvt. Ltd
Mobility Solutions
Mobility Solutions
Mobility Solutions
Mobility Solutions
Mobility Solutions
Industrial Technology
Industrial Technology
Consumer Goods
21 September 2015
24

Bosch
Exhibit 46: Bosch’s unlisted companies in India growing faster than BOS
Bosch Ltd
Bosch Unlisted Cos in India
57
5 Yrs CAGR
23.1%
26
20
47
CY09
66
CY10
34
45
47
79
84
85
96
15%
CY11
CY12
CY13
CY14
Source: Company, MOSL
Exhibit 47: Safety and electrification of powertrain to be high-growth drivers…
Source: Continental, MOSL
Exhibit 48: …as will drive increase in content per car
Source: Delphi, MOSL
21 September 2015
25

Bosch
Exhibit 49: Global platforms to account for ~53% of total vehicle production by 2020
Source: Delphi, MOSL
Exhibit 51: While Bosch is the biggest player in the
Exhibit 50: Globally, Bosch is the biggest OEM supplier; but Powertrain segment, unlike India it faces strong competition
competitors are also sizeable
globally
Powertrain
*
Delphi
12%
Bosch AG
36%
Denso
31%
*Based on
Powertrain revenues
of these 4 players
Source: Continental, MOSL
Continental
21%
Source: Company, MOSL
Exhibit 52: Market position for Diesel Injection Systems Exhibit 53: Market position for Gasoline Injection Systems
(2014)
(2014)
Source: Continental, MOSL
Source: Continental, MOSL
21 September 2015
26

Bosch
Valuation and view
Strong industry positioning, technology focus enables high growth visibility
BOS enjoys very strong and unique positioning in the auto component industry with
focus on technology enabling high value add, strong relationships with OEMs and
strong aftermarket presence (refer Exhibit 50).
BOS has several levers to drive over 20% CAGR in revenues over the next 5-6 years
(~23% CAGR over FY15-18), as BOS is at forefront of technological evolution of the
Indian auto industry.
Operating leverage would drive EBITDA margin improvement of ~340bp to ~19.8% by
FY18, driving ~34% EPS CAGR over FY15-18 (on the back of flat EPS over CY11-14). As a
result, we estimate RoEs to improve by ~400bp to ~23.9% and RoICs by 1.6pp to 41%
by FY18.
BOS stock has got significantly re-rated over the last 12 months on anticipation of
strong recovery and EPS growth, along with technical factors like inclusion in
benchmarks (Nifty and MSCI).
For BOS stock to deliver ~15% CAGR over the next five years, without any de-rating
(~35x one-year forward), EPS needs to grow at over 25% CAGR.
The stock trades at 35.1/25.9x FY17E/18E EPS, 23.6/17.8x FY17E/18E EV/EBITDA and
6.8/5.7x FY17/18 P/BV.
BOS premium valuations vis-à-vis its auto component peers is manifestation of very
strong and unique industry positioning as reflected in lower cyclicality in operating
performance, stronger long term growth outlook and superior capital efficiencies
(refer Exhibit 51).
We initiate with Buy, with a target price of ~INR26,864 (35x FY18E Core EPS +
~INR2,356/share net cash).
Exhibit 54: BOS: Industry positioning very strong…
Technology intensity
Scope for increase in content per vehicle
Product criticality
Customer stickiness
Aftermarket contribution
Export Contribution
Capex intensity
Average Ranking
BOS
5
5
5
5
2
2
3
3.9
BHFC
3
3
4
4
0
5
2
3.0
EXID/AMRJ
2
1
3
3
3
1
5
2.6
APTY
2
2
3
2
5
2
2
2.6
Wabco
5
3
5
4
2
3
4
3.7
MSSL
3
4
4
3
0
2
4
2.9
Source: MOSL
Exhibit 55: …as reflected in superior and less volatile operating performance
Revenue Growth
EBITDA Growth
PAT Growth
Gross Fixed Asset Turn
Net Debt:Equity
RoE
Average Ranking
BOS
5
4
5
3
5
3
4.2
BHFC
3
4
4
2
3
4
3.3
AMRJ
4
4
4
5
4
4
4.2
APTY
1
1
1
2
2
3
1.7
Wabco
MSSL
5
3
5
5
5
5
4
4
4
3
4
5
4.5
4.2
Source: Bloomberg, MOSL
21 September 2015
27

Bosch
Exhibit 56: Over 30% EPS CAGR (FY15-18E)…
EPS (INR)
65.2
45.4
30.7
3.8
(14.6)
(14.3)
37.2
35.3
29.9
23.0
Growth (%)
36.7
25.4 26.7
18.6 19.8
13.8
Exhibit 57: …coupled with improvement in RoIC…
RoIC (%)
RoE (%)
30.4
19.9
27.6
17.8
34.4
21.1
41.0
23.9
Source: Company, MOSL
Source: Company, MOSL
Exhibit 58: …would support premium valuations
60
45
30
15
0
29.8
23.8
19.1
40.3
6
3
0
4.5
3.7
5.1
P/E (x)
5 Yrs Avg(x)
15 Yrs Avg(x)
10 Yrs Avg(x)
12
9
P/B (x)
5 Yrs Avg(x)
15 Yrs Avg(x)
10 Yrs Avg(x)
7.4
Source: MOSL
Source: MOSL
21 September 2015
28

Bosch
Bosch| Key Operating Indicators
Exhibit 59: Sales and Sales Growth
38.9
22.2
6.0
1.1
10.4
17.0
Net Sales (INR b)
Growth (%)
25.6
26.6
Exhibit 60: Segment Mix
Fuel Injection Equipment
Starters & Generators
Others
10
10
12
13
6
7
7
8
7
8
11
12
23
23
23
23
53
CY10
Source: Company, MOSL
52
CY11
47
CY12
44
CY13
Injectors & Nozzles
Power tools
15
8
12
26
39
15
7
11
26
40
15
7
10
27
40
15
6
10
29
41
FY15 FY16E FY17E FY18E
(15m)
Source: Company, MOSL
Exhibit 61: Gross Margins v/s EBITDA margins
Gross Margins (%)
47
46
45
44
CY10 CY11 CY12 CY13 FY15 FY16E FY17E FY18E
(15m)
Source: Company, MOSL
EBITDA Margins (%)
24.0
16.0
Exhibit 62: Dividend payout to remain stable
43.9
Dividend Payout (%)
22.9
17.1
24.8
24.0
23.0
23.0
23.0
8.0
0.0
CY10
CY11
CY12
CY13
FY15 FY16E FY17E FY18E
(15m)
Source: Company, MOSL
Exhibit 63: FCF and Net Cash
CFO (INR b)
Capex (INR b)
FCF (INR b)
Exhibit 64: Cash would be over 60% of the capital employed
Net Cash (INR/sh)
61
45
48
Net Cash (as % of Cap Employed)
63
65
62
61
53
(1.5)
(3.3)
(5.8)
(3.7)
(4.8) (6.5)
(6.5)
(6.5)
CY10
Source: Company, MOSL
CY11
CY12
CY13
FY15 FY16E FY17E FY18E
(15m)
Source: Company, MOSL
21 September 2015
29

Bosch
Operating metrics
Snapshot of Revenue Model (INR m)
Fuel Injection Equipment
Growth (%)
% of Net Revenues
Injectors, Nozzles and Nozzle holders
Growth (%)
% of Net Revenues
Starters and Generators
Growth (%)
% of Net Revenues
Portable Electric Power tools
Growth (%)
% of Net Revenues
Others
Growth (%)
% of Net Revenues
Total Gross sale of product
Growth (%)
Less: Excise Duty
Excise Duty (% of Net Sales)
Net Sales
Growth (%)
Service Income
Growth (%)
% of Net Sales
Total Other Operating Income
Net Revenues
Growth (%)
- of which Exports
Growth (%)
% of net revenues
EBITDA
- EBITDA Margins (%)
PAT
EPS (INR/Share)
Core EPS (INR/Share)
CY10
37,519
46
56
16,333
45
24
4,924
32
7
4,555
29
7
7,390
22
11
70,722
41
4,417
7
66,305
40
512
-14
1
0
66,817
39
8,461
45
13
10,531
16
8,589
274
237
CY11
44,183
18
54
19,839
21
24
6,731
37
8
5,660
24
7
8,919
21
11
85,332
21
6,037
8
79,295
20
677
32
1
1,686
81,658
22
10,344
22
13
15,119
19
11,227
358
293
CY12
42,960
-3
50
21,423
8
25
9,629
43
11
6,356
12
7
10,954
23
13
91,322
7
7,150
8
84,172
6
1,052
55
1
1,367
86,591
6
9,402
-9
11
13,495
16
9,583
305
233
CY13
40,396
-6
46
21,270
-1
24
10,916
13
12
7,146
12
8
12,372
13
14
92,100
1
6,949
8
85,151
1
1,346
28
2
1,070
87,567
1
10,578
13
12
12,277
14
8,213
262
193
15M FY15
49,297
-2
41
32,601
23
27
14,448
6
12
9,951
11
8
19,297
25
16
125,594
9
8,180
7
117,414
10
2,000
19
2
1,441
120,855
10
14,625
11
12
19,813
16
13,376
426
315
FY16E
47,945
22
42
31,699
22
28
13,325
15
12
8,901
12
8
18,096
17
16
119,966
19
9,905
9
110,060
17
1,761
10
2
1,295
113,116
17
14,308
22
13
20,377
18
14,078
448
346
FY17E
60,642
26
43
41,208
30
29
15,687
18
11
10,407
17
7
22,786
26
16
150,731
26
12,446
9
138,285
26
2,213
26
2
1,548
142,046
26
17,977
26
13
27,276
19
19,319
615
502
FY18E
77,721
28
43
54,498
32
30
18,471
18
10
12,170
17
7
27,935
23
16
190,794
27
15,754
9
175,040
27
2,801
27
2
1,932
179,773
27
22,755
27
13
35,604
20
26,144
833
700
21 September 2015
30

Bosch
Financials and valuations
Standalone - Income Statement
Y/E December
Income from Operations
Less: Excise Duty
Total Income from Operations
Change (%)
Total Expenditure
% of Sales
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income
PBT after EO Exp.
Tax Rate (%)
Adjusted PAT
Change (%)
CY10
71,234
4,417
66,817
38.9
56,287
84.2
10,531
15.8
2,540
7,991
39
4,076
12,028
28.6
8,589
45.4
CY11
87,695
6,037
81,658
22.2
66,539
81.5
15,119
18.5
2,578
12,541
4
3,203
15,740
28.7
11,227
30.7
CY12
93,741
7,150
86,591
6.0
73,096
84.4
13,495
15.6
3,670
9,825
55
3,692
13,462
28.8
9,583
-14.6
CY13 15M FY15
94,516
129,035
6,949
8,180
87,567
120,855
1.1
38.0
75,290
101,042
86.0
83.6
12,277
19,813
14.0
16.4
3,842
5,484
8,435
14,329
29
143
3,526
5,653
11,932
19,558
31.2
31.6
8,213
13,568
-14.3
65.2
FY16E
123,021
9,905
113,116
17.0
92,739
82.0
20,377
18.0
4,661
15,716
90
5,386
21,012
33.0
14,078
29.7
FY17E
154,492
12,446
142,046
25.6
114,770
80.8
27,276
19.2
5,303
21,973
90
5,715
27,599
30.0
19,319
37.2
(INR Million)
FY18E
195,526
15,754
179,773
26.6
144,169
80.2
35,604
19.8
5,888
29,716
90
6,434
36,060
27.5
26,144
35.3
Standalone - Balance Sheet
Y/E December
Equity Share Capital
Total Reserves
Net Worth
Total Loans
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Total Investments
Curr. Assets, Loans&Adv.
Inventory
Account Receivables
Cash and Bank Balance
Loans and Advances
Curr. Liability & Prov.
Account Payables
Other Current Liabilities
Provisions
Net Current Assets
Deferred Tax assets
Appl. of Funds
E: MOSL Estimates
CY10
314
40,666
40,980
2,764
43,744
30,238
25,878
4,360
2,242
16,073
37,521
8,093
7,210
13,259
8,960
18,634
9,931
3,439
5,263
18,887
2,182
43,744
0
CY11
314
46,970
47,284
3,071
50,355
33,584
27,667
5,917
3,207
16,347
43,563
11,831
8,959
9,515
13,258
20,955
10,305
4,967
5,683
22,608
2,276
50,355
0
CY12
314
55,419
55,733
2,304
58,037
39,414
30,781
8,633
4,083
15,286
48,468
10,957
10,270
14,872
12,369
20,985
9,287
4,449
7,249
27,483
2,552
58,037
0
CY13 15M FY15
314
314
62,629
73,156
62,943
73,470
1,831
1,122
64,774
74,592
43,086
47,908
33,705
38,232
9,381
9,676
4,568
2,760
21,851
28,896
50,423
58,805
12,072
12,762
10,735
11,877
14,415
18,960
13,201
15,206
24,438
29,716
10,646
12,165
6,543
4,379
7,249
13,172
25,985
29,089
2,989
4,172
64,774
74,592
0
0
FY16E
314
83,996
84,310
1,122
85,432
55,668
42,893
12,775
1,500
28,896
64,695
11,945
11,116
27,402
14,232
26,606
9,335
4,098
13,172
38,089
4,172
85,432
0
FY17E
314
98,871
99,185
1,122
100,308
62,168
48,196
13,972
1,500
28,896
81,639
15,000
13,959
34,808
17,872
29,871
11,553
5,146
13,172
51,767
4,172
100,308
0
(INR Million)
FY18E
314
119,002
119,316
1,122
120,438
68,668
54,083
14,585
1,500
28,896
105,483
18,983
17,667
46,214
22,619
34,198
14,512
6,513
13,172
71,286
4,172
120,438
0
21 September 2015
31

Bosch
Financials and valuations
Ratios
Y/E December
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
FCF per share
Return Ratios (%)
RoIC
RoE
RoCE
Working Capital Ratios
Fixed Asset Turnover (x)
Asset Turnover (x)
Inventory (Days)
Debtor (Days)
Creditor (Days)
Wkg. Cap. Turnover (Days)
CY10
273.5
354.4
1,305.1
40.0
17.1
CY11
357.5
439.6
1,505.9
135.0
43.9
CY12
305.2
422.1
1,774.9
60.0
22.9
CY13
261.6
383.9
2,004.6
55.0
24.8
15M FY15
432.1
606.8
2,339.8
85.0
24.0
50.0
35.6
9.2
5.5
33.3
0.4
286.1
30.4
19.9
28.7
2.5
1.6
39
34
37
31
FY16E
448.3
596.8
2,685.0
85.7
23.0
48.1
36.2
8.0
5.8
32.0
0.4
203.3
27.6
17.8
26.4
2.0
1.3
39
33
30
34
FY17E
615.3
784.1
3,158.8
117.6
23.0
35.1
27.5
6.8
4.5
23.6
0.5
198.2
34.4
21.1
29.8
2.3
1.4
39
33
30
44
FY18E
832.6
1,020.1
3,799.9
159.1
23.0
25.9
21.2
5.7
3.5
17.8
0.7
352.7
41.0
23.9
32.8
2.6
1.5
39
33
29
51
0.2
186.4
29.9
23.0
30.0
2.2
1.5
44
37
54
31
0.6
-29.6
36.7
25.4
33.5
2.4
1.6
53
37
46
59
0.3
82.0
26.7
18.6
24.9
2.2
1.5
46
40
39
53
0.3
170.2
19.8
13.8
19.5
2.0
1.4
50
41
44
48
Standalone - Cash Flow Statement
Y/E December
OP/(Loss) before Tax
Depreciation
Interest & Finance Charges
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
CF from Operating incl EO
(Inc)/Dec in FA
Free Cash Flow
(Pur)/Sale of Investments
Others
CF from Investments
Inc/(Dec) in Debt
Interest Paid
Dividend Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Opening Balance
Closing Balance
CY10
12,028
2,540
-1,144
-4,027
-141
9,256
8,859
-3,006
5,854
-1,534
-525
-5,064
-79
-36
-942
-157
-1,214
2,581
10,678
13,259
CY11
15,740
2,578
-1,843
-4,682
-5,996
5,797
4,446
-5,376
-930
943
502
-3,931
308
-5
-3,925
-637
-4,259
-3,744
13,259
9,515
CY12
13,462
3,670
-2,065
-3,631
-1,284
10,152
8,712
-6,138
2,574
2,114
2,231
-1,793
289
-25
-1,570
-256
-1,562
5,357
9,515
14,872
CY13 15M FY15
12,566
19,559
3,842
5,484
-2,343
-3,474
-4,258
-6,911
1,552
1,316
11,359
15,974
10,594
13,942
-5,251
-4,960
5,343
8,982
-5,918
-16,295
2,521
9,460
-8,648
-11,795
-147
-709
-52
-86
-1,884
-2,021
-320
434
-2,403
-2,382
-457
-235
14,872
14,415
14,415
14,180
FY16E
21,012
4,661
-5,296
-6,934
-559
12,884
12,884
-6,500
6,384
0
5,386
-1,114
0
-90
-3,238
0
-3,328
8,442
14,180
22,622
FY17E
27,599
5,303
-5,626
-8,280
-6,272
12,724
12,724
-6,500
6,224
0
5,715
-785
0
-90
-4,443
0
-4,533
7,406
22,622
30,028
(INR Million)
FY18E
36,060
5,888
-6,344
-9,917
-8,112
17,575
17,575
-6,500
11,075
0
6,434
-66
0
-90
-6,013
0
-6,103
11,406
30,028
41,434
21 September 2015
32

Bosch
NOTES
21 September 2015
33

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