Tuesday, February 28, 2012

Bosch grows 20%, profits up by 31%

Bangalore: Bosch Ltd, the flagship company of German auto parts maker Robert Bosch Gmbh’s Indian operations, reported a 20% increase in 2011 revenue to Rs. 8,018 crore and a 31% in net profit to Rs. 1,123 crore.
Photo: Bloomberg
The entire Bosch group in India, which has six other companies apart from the lone listed entity, reported revenue of Rs. 11,511 crore, a 23.4% increase over the previous year.
V.K. Viswanathan, managing director, said the growth came in a “mixed year”—growth for the automotives sector slowed to 6% in the second half from about 22% in the first, with the passenger car and utility vehicle segment regressing the most as its growth contracted 3%.
“Overall, our key target market grew by 13.5% in the year, but we grew faster than that,” Viswanathan said. “There was improved demand in tractors and light commercial vehicles. Our automotive aftermarket (products and services) and power tools businesses also showed consistent growth. Profitability was also helped by other income, with some of our investments providing better yields due to prevailing interest rates.”
Bosch is optimistic for 2012 but growth will depended on interest rates, inflationary trends, currency volatility and other macroeconomic factors that depressed growth in the second half of 2011 and could impact the sector this year as well, he added.
Bosch Ltd, the listed entity, invested about Rs. 660 crore in 2011 on capital expenditure, particularly for capacity expansion in its Nashik plant that makes fuel injectors, and will continue to spend at this level over the next couple of years, said Soumitra Bhattacharya, chief financial officer.
Other group companies invested Rs. 400 crore.
Bosch’s operating margin improved to 15.7% from 15.2%, despite higher input costs and currency volatility, he added.
The diesel systems business grew by 19.2% to about Rs. 4,700 crore, and the automotive aftermarket business by 15.2% to Rs. 1,800 crore, Viswanathan said. The aftermarket market is the secondary market for spares, components and accessories as well as services meant for vehicles that are already on the roads.
The starters and generators business grew by 63% to Rs. 490 crore, and the power tools business by 22% to Rs. 550 crore.
Exports grew by 22.3% to cross the Rs. 1,000-crore mark helped by demand in Germany, China, Brazil and Korea, he added. Robert Bosch Gmbh owns about 71% of Bosch Ltd.
Bosch said it will pay a dividend of Rs. 50 a share, compared with Rs. 40 a share last year, and in addition to the Rs. 85 a share dividend declared in June on the occasion of the company’s 125th anniversary worldwide.
Shares of Bosch jumped 3% to Rs. 7,883.95 on the Bombay Stock Exchange on Tuesday, while the Sensex rose 1.64% to 17,731.12 points.

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