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Bosch Ltd.

BSE: 500530 Sector: Auto
NSE: BOSCHLTD ISIN Code: INE323A01026
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OPEN 17003.35
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VOLUME 625
52-Week high 18300.00
52-Week low 12940.10
P/E 38.91
Mkt Cap.(Rs cr) 50,263
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 17003.35
CLOSE 17003.35
VOLUME 625
52-Week high 18300.00
52-Week low 12940.10
P/E 38.91
Mkt Cap.(Rs cr) 50,263
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Bosch Ltd. (BOSCHLTD) - Director Report

Company director report

#MDStart#

Management Discussion and Analysis

The Directors have pleasure in presenting the 70th AnnualReport together with the Audited Financial Statements for the Financial Year ended March31 2022.

1. FINANCIAL RESULTS

The following are the standalone financial highlights for the FinancialYear 2021-22:

[Rs. in Million]
Particulars 2021-22 2020-21
Sale of Products 111047 89646
Of which Export Sales

11907

8606

Profit before exceptional item and tax 15001 13110
Exceptional item - 7439
Profit Before Tax 15001 5671
Total tax expense 2829 846
Profit for the year 12172 4825
Other comprehensive income (Net of tax) (122) 3799
Total Comprehensive income for the year 12050 8624

The Company does not propose to transfer any amount to Reserves for theyear under review.

2. DIVIDEND

The Board of Directors has recommended a dividend of ` 110/- per equityshare of ` 10 each. In addition the Board has recommended a special dividend of ` 100/-per share of ` 10/- each to commemorate 100 years of Bosch in India in 2022. The totaldividend payout for the financial year 2021-22 is ` 210/- per equity share (previous year` 115/- per equity share) aggregating to Mio ` 6194/-. The dividend payout ratio isapproximately 51%. The Dividend is subject to the approval of the shareholders at theforthcoming Annual General Meeting.

Pursuant to the requirements of regulation 43A of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015 the Company has adopted aDividend Distribution Policy. This Policy is uploaded on the website of the Company andcan be accessed at https://www.bosch. in/media/our_company/shareholder_information/2017_2/dividend_distribution_policy_2017.pdf.

3. MANAGEMENT DISCUSSION AND ANALYSIS

In order to avoid duplication between the Directors' Report andManagement Discussion and Analysis a composite summary of the Company's performanceand its various business segments is given below:

3.1 Economic Scenario

3.1.1 Global Economy

The world economy was expected to do well in 2022 supported by strongfiscal and monetary push especially in the developed market. That said two shocks inrecent months the war in Ukraine and the build-up of momentum in elevated US and Europeaninflation have caused us to revise our forecast downward significantly for global growth.Inflation in the US and Europe is now pushing towards 8% well in excess of what wasexpected. More trouble especially in the US are signs that the underlying drivers ofinflation have broadened emanating from very tight labor market conditions and spreadingfrom goods to services. The US Federal Reserve (FED) finding itself now well behind thecurve has given clear signals that it is shifting to a more aggressive tightening mode.Given this world economy is expected to grow by 3.1% in 2022 and 2.9% in 2023. Moreimportantly these forecasts were 4.4% for 2022 and 3.7% for 2023 at the beginning of thisyear and have been marked down substantially.

3.1.2 Indian Economy

India is unlikely to achieve a growth rate of 8-8.5% in FY23 due tothe impact of Russia-Ukraine conflict aggressive FED rate hike cycle and China + globalgrowth slowdown but a 7-7.5% real GDP growth will still be a decent outcome under thecircumstances. The bigger priority now is to reduce inflation so that the ongoing growthrecovery can be sustained on a durable basis.

From a slightly positive perspective India remains relatively lessvulnerable to global external shocks compared with the other open market emergingeconomies which should help cushion downside growth risks. Fortunately the impact of thethird Covid-19 wave has also proven to be limited with mobility improving back topre-pandemic levels swiftly. INR has largely been range bound against the USD (74-77)primarily driven by record balance of payment surplus and massive amount of Forex reservesaccumulated by RBI.

3.2 Industry Structure and Development Automotive:

The overall automobile production volumes in FY22 marginally grew by+1% YoY marred by several headwinds like supply chain bottlenecks and semi-conductorshortages. The impact caused by the successive waves of the pandemic and the consequentlockdown restrictions by various states across the country adversely affected the rural aswell as the urban markets.

The current geopolitical tensions has increased the commodity pricescrude oil prices and has exacerbated supply chain issues. The Indian automotive industrywill not be directly affected by the war in Ukraine but the conflict and resultingsanctions on Russia is causing supply-chain disruptions and giving rise to increase incommodity prices. India imports a large part of its crude oil and elevated oil prices willput further pressure on fuel prices. Rising fuel prices is also driving consumers towardsalternate fuels. After achieving its peak in FY19 the domestic auto industry has seen twoyears of decline up to FY21 before recovering in FY22 over a very low base. PC and CVsectors have rebounded in FY22 on a low base Tractor has remained stable after peaking inFY21 while the 2W sector declined consecutively for a third year.

Passenger Car sector demand has remained upbeat throughout FY22.However the industry's volume growth has been limited by supply constraints whichhave been accentuated by the ongoing chip shortages. An improved chip supply over the pastfew months has however aided a ramp-up in production levels for OEMs. The demand-supplymismatch has led to high waiting period for best-selling models from 2 to 12 months ormore.

The Commercial Vehicle industry on the other side saw a healthy growthcompared to last year led by strong demand better capacity utilization and replacementdemand. While we are seeing recovery in the segment volumes are yet to recover topre-Covid levels despite opening up of the economy.

The tractor industry volumes touched an all-time high in FY2021 aidedby a combination of robust farm cashflows and healthy monsoons. Even as the spread ofpandemic to rural areas and an uneven monsoon performance remained a concern industryvolumes remained largely healthy. 2W industry declined in FY22 despite having apandemic-impacted low base year. While domestic demand is heading for the thirdconsecutive year of contraction exports witnessed high volumes in FY2022 driven byhealthy demand from African and LATAM markets.

An increasing trend towards alternate fuel vehicles such as CNG and EVwas seen due highly inflated fuel prices decreasing gap of acquisition cost with ICEbetter TCO and Govt push for alternate fuels adoptions

Vehicle Production Growth Rates:

Vehicle production growth over previous Fiscal Year (+ / -)
Segment FY13-14 FY14-15 FY15-16 FY16-17 FY17-18 FY18 -19 FY19-20 FY20-21 FY21-22
HCV -20% 26% 24% 2% 3% 28% -47% -22% +48%
LCV -14% -10% 3% 6% 18% 22% -21% -15% +21%
Car + UV -4% 6% 6% 11% 6% 0% -15% -11% +19%
3-Wheeler -1% 14% -2% -16% 31% 24% -11% -46% +23%
Tractor 22% -13% -7% 21% 14% 14% -15% +27% +0%
2-Wheeler 7% 10% 2% 6% 16% 6% -14% -13% -3%
TOTAL -2% 5% 2% 6% 15% 7% -14% -13% +1%

Non-Automotive:

The Indian Professional Tools market is estimated to be around ` 21billion by value in year 2021 and is expected to grow at a CAGR of 8% (2021 to 2025). Thisis in line with the estimated government spends on infrastructural projects and expectedinvestment in manufacturing industries. The ongoing Ukraine-Russia crisis and Covidinduced lockdowns in China has put further pressure on cost structure including rawmaterial costs which has resulted in increased power tools price across portfolios in themarket. This further needs to be managed from the market scenario and cost trends.

The safety and security industry in India has experienced steady growthof more than 5% across various segments. Rapid urbanization expansion in Energy andmanufacturing industries infrastructure and mass transportation systems are drivinggrowth in the safety and security market particularly in critical national infrastructuresectors. End users of safety security and communication products and services includeairport metro-rail government enterprises law enforcement agencies defense energy andmanufacturing industry IT/ITES commercial and noncommercial enterprises. The industry ishighly fragmented and price sensitive.

The market is also preparing itself to deal with the challengingthreats and changes driven by fast changing hardware and software. The industry is alsomaturing driven by the renewed scope in Regulation and Bottoms-up desire to feel safe andsecure. Market is experiencing a strong Digital Innovation drive with topics like IoT andCloud based solutions AI and machine learning.

3.3. Business segment wise performance

The overall sales performance of the Company witnessed growth of 23.9%over FY 2020-21. Mobility business (Automotive) revenue increased by 22.6% while theBusiness beyond mobility (Others) increased by 31.6%. Domestic mobility business witnessedincrease of 21% mainly driven by Powertrain due to higher order fulfilment and a low basein FY 2020-21.

As the Company predominantly operates in manufacturing and trading ofmobility solutions this constituted 86% of total sales for the Financial Year 2021-22.The Business beyond mobility comprising of Industrial Technology Consumer Goods andEnergy and Building Technology had a share of 14%. Thus the operating segment is broadlyclassified into "Mobility Business" (Automotive Products) and "Businessbeyond mobility" (Others).

3.3.1 Operating Segment

The division Powertrain Solutions (PS) combines the strengths of thesmart diversified and sustainable powertrain under the vision ‘Passion toMove'. PS offers integrated solutions in the market segments Electric Vehicles (EL)Passenger Cars (PC) and Commercial Vehicles / Off-Road (CV/OR) and aim to become No. 1provider of products and solutions in the diversified powertrain sector ranging fromgasoline and diesel injection to electrified drives with battery and fuel celltechnologies. Powertrain Solutions is pushing ahead with the further development ofinnovative eco-friendly technologies and systems based on Diesel and gasoline. Theyinclude engine management systems fuel supply modules fuel injectors pumps andignition systems. For diesel systems the division is developing even more fuel-efficientand eco-friendly injection systems for applications ranging from passenger cars andcommercial vehicles of all kinds to industrial power-generation units.

During Q1 of FY 2021-22 the COVID-19 second wave situation in April andMay resulted in supply chain restrictions manpower constraints absenteeism and liquiditycrisis including oxygen supply issues as the same was needed for medical usage and amountof oxygen available for manufacturing was restricted. Overall automotive market duringFY2021-22 was effected by unfavorable economic conditions owing to the COVID-19 pandemic.Despite this we made a sound recovery commencing from Q3 of FY 2021-22. The demand in HCVand LCV has also been good due to infrastructural projects across the nation such as roadconstruction mining etc. and growing demand for better last mile connectivity. With theonset of COVID-19 we also witnessed a growing demand for personal mobility contributingto increased demand in the two wheeler and PC Segment however we had Semiconductor supplyconstraints due to which the supply was lower than the demand.

During the FY-2021-22 we witnessed good demand for CRI CRIN Exhaustgas sensors for PC Segment CP4 and DV-E. Record sales were made in the month of March2022 due to the ECU chip parts sourced by the customers separately and due to which theset part sales and ECU sales ramped up. Also higher sales in A-Pump were recorded due toincrease in sales in tractor market.

In future the growing working population and expanding middle classwill remain the key drivers of growth for automobile industry. Further the increasinginfrastructural activities across the nation the growth in E-commerce activity and needfor last mile connectivity increasing demand for electric battery and hybrid vehiclesoffers ample growth opportunity in the Indian automobile front.

Automotive Aftermarket

During the first quarter of 2021 the economic conditions recovered andso did the automotive sector. This was hampered by the devasting second wave of COVID-19which peaked in May'21 with lockdowns and curfews. Our main focus was our employeesand customers. We introduced the Bosch Covid Care (BCC) insurance policy to support ourcustomers. Further the market started recovering during the third quarter with growth inthe automotive sector and improved mobility. Automotive Aftermarket division in India madea strong comeback in Q3 and Q4 of FY 2020-21 with our approach of being closer to ourcustomers and demand generation activities.

Automotive Aftermarket Division (AAIN) achieved the highest ever TotalNet Sales in FY 2021-22 with a growth of 26.5% compared to the previous year. We haveimproved our operating margins through restructuring price corrections and various costreduction measures. Best ever Net Working Capital coverage days was also achieved in FY2021-22 with improvement in receivables and payables. Our customer satisfaction indeximproved in all areas such as product communication and logistics despite marketdisruptions. Our GPTW Trust Index improved and sustenance of the implemented measures tomake AAIN the Best Place To Work. Our Genplast product (Three-stage diesel Filter) baggedprestigious awards such as the Bosch Quality award WoCo Quality Award – ProductLaunch Bosch India Innovation awards and the CII Industrial Innovation award.

Our emphasis on secondary market continued to yield positive results aswe consistently increased our active retailers & workshops in second half of FY2021-22 post the Covid second wave. We also increased our overall visibility in line withour strategy of ‘Har Shop Mein Bosch' across 3 key segments in Rural marketscovering 60+ rural towns branding uplift across our BDS network & Top Retail Brandingin key towns. We continued to grow market share in key products such as diesel androtating machines and additionally introduced the LED lighting range further strengtheningour product portfolio. The Company acquired a minority stake of 26% in Autozilla SolutionsPrivate Limited and this will support the automotive aftermarket to participate in thedigital B2B marketplace. The Company will integrate Autozilla's eCommerce platformwith its digital platforms to improve the quality of catalogue search streamline orderingof spare parts from workshops to distributors and address availability of spares withshorter lead times.

Business beyond mobility:

The Business beyond Mobility sales have increased by 31.6% which wasdriven predominantly by Power Tool and Bosch Energy & Building Solution Division indomestic market; which contributed to 92% of total business beyond mobility during theyear under review as compared to 81.7% during the previous financial year. Exports salesof total business beyond mobility increased by 8.2% as compared to previous financialyear.

Consumer Goods - Power Tools

The Power Tools division supplies power tools power-tool accessoriesand measuring technology. The division has an extensive product range aimed atprofessional users in trade and industry a small portfolio for the DIY market and amateurcrafters. One of the focal points of the division is convenient high-performance cordlesstools and great engineering progress.

During the year under review the division's revenue had aphenomenal growth of 30% in FY 2021-22 over previous year 2020-21 out of which digitalbusiness grew by 43% which supported in increasing the share of digital business from 9%to 10%. The plant production generated a growth of 7% over the previous year. The Divisionaims at reducing the distance to its users and will continue to focus on improving theirlives by providing affordable solutions. It's focus on the BeConnected user &trade engagement program and E-commerce channels for business would also continue to beessential contributors to the overall business growth.

Building Technology (Security Technology)

The Building Technology division manufactures innovative products andsolutions in the field of security safety and communications primarily for infrastructureand commercial applications. The product portfolio includes video surveillance intrusiondetection fire detection and voice evacuation systems as well as access control andmanagement systems. Critical Communication Systems Professional audio and conferencesystems for communication of voice sound and music complete the range. Bosch securitydivision offers wide range of security solutions for every application to minimize risksand maximize security irrespective of the nature of security risk. The business saw agrowth of 31% in revenue over the previous year with key wins across verticals. Theverticals of Transportation Government Energy and Commercial sector continued tocontribute to the business growth in addition to support coming in from the Healthcarevertical. Our solutions help make buildings intelligent and future-ready improvingefficiency and augmenting security and convenience. We enable seamless Integration of allSystems on a single platform for enhanced user experience. We tap the potential of IoT anddigitalization to increase security comfort and efficiency. Our proprietary platforms inthese domains are INTEOX - Built-in Intelligent Video Analytics complemented with CameraTrainer PRAESENSA - Bosch's latest IP based Public Address System and AVIOTEC -Video-based fire detection system.

Bosch Energy & Building Solutions

During this year there has been positive trend for the EnergyEfficiency (EE) solution with industries picking up with pandemic situation easing.Business Unit Bosch Energy and Building Solutions achieved its business plan for the year2021. The Net sales from the business grew by a robust 44% over the previous financialyear. As this business is mainly into the EE projects business cost saving solutionsearly order acquisition and timely execution are the focus area from the business longterm sustainability point of view. To increase the customer base and EE projects orderintake business is focusing on geographical expansion with special focus on industrialclusters to scale up the identified EE solutions.

3.3.2 Revenue by geographical area

Contribution of export sales to the total sales increased to 11.08% forthe year under review as compared to 10.35% during the previous financial year. TheCompany's exports bulk of which is to Germany increased by 22% over previous yearmainly in Powertrain Solutions and Automotive Aftermarket divisions.

3.4 Financial Performance Sale of products

Sale of products increased by 23.9% over previous year on a comparablebasis and stood at Mio ` 111047.

Bosch Limited's Mobility Solutions business sector increasedproduct sales by 22.6% in fiscal 2021-22 primarily on account of growth in production ofHeavy Commercial Vehicles Cars and Utility Vehicles and a low base in FY 2020-21.

Sale of services

Sale of services decreased by 14% over previous year. There was ahigher recognition of income on R&D contracts completed during the previous year.

Other operating revenue

Other operating revenue stood at Mio ` 2282 which decreased by 2%over the previous year. This decrease is mainly contributed by reduction in Misc. Income.

Other income

Other income which mainly comprises of mark-to-market gains on mutualfund investments & interest income on fixed deposits has declined by 21% over previousyear mainly due to reduction in interest rates by 250 basis points during FY 2021-22compared to previous FY resulting in lesser mark-to-market gains on mutual funds andlesser interest income on fixed deposits.

Cost of materials consumed

The cost of materials consumed as a percentage of total revenue fromoperations increased to 62% in 2021-22 from 59.4% in 2020-21. The increase is contributedby change in product mix with higher share of traded goods and increase in raw materialprices mainly steel and aluminum which have seen steep increases over the previous yearwhich has been partially off-set by cost reduction measures with third party suppliers.

Personnel cost

Personnel cost for the year under review was Mio ` 10720 as againstMio ` 9316 of the previous year. Personnel cost of previous year had a one-time reversalof provisions to the tune of Mio ` 2247. On like-to-like basis personnel cost hasreduced from 11.9% of revenue in FY 2020-21 to 9.1% of revenue in FY 2021-22.

The Company continues to focus on restructuring redeploying andre-skilling its workforce based on its business needs in a fair manner while sustainingproductivity and competence.

Depreciation and amortization

The depreciation charge for the year under review was Mio ` 3243 asagainst Mio ` 3414 during the previous year ended on March 31 2021. The reduction is dueto higher opening asset base in FY 20-21 which led to higher depreciation in PY.

Total tax expense

Tax Expense represents a net charge of Mio ` 2829 in the year underreview as compared to Mio ` 846 in previous year. The effective tax rate for year underreview was 18.9% as compared to 14.9% in previous year. In the previous year tax expensewas lesser due to deferred tax asset created on account of provision made forrestructuring.

Profit after Tax (PAT)

Profit after tax increased by 152% to Mio ` 12172 in the period underreview from Mio ` 4825 in previous financial year. The increase is on account ofimprovement in operating margins to 9.6% of revenue from 8.4% of revenue in previous year.Also previous year had one time impact of exceptional item of ` 7439 Mio.

Other Comprehensive Income

The investment in equity securities is classified as financial assetsthrough other comprehensive income as per the requirements of Ind AS 109. The changes infair value of equity securities is recognized under other comprehensive income.Accordingly the impact of Mio ` 122 (net of taxes) during the year under review is mainlydue to decrease in the fair value of those Investments and post employment benefitobligations pertaining to employee benefits.

Earnings per Share (EPS)

EPS (basic and diluted) of the Company for Financial Year 2021-22 was `413 per share as against ` 164 in FY 2020-21.

Share capital

As on March 31 2022 the Authorized Share Capital comprises of38051460 Equity Shares of ` 10 each. The issued subscribed and paid-up capital is Mio `294.94 divided into 29493640 equity shares of ` 10 each.

Reserves & Surplus

Reserves & Surplus as on March 31 2022 stood at Mio ` 96456which includes retained profits of Mio ` 96030.

Other Reserves

Other Reserves decreased from Mio ` 10150 to Mio ` 10128 mainly dueto change in the fair value of equity investments valued in line with Ind AS - 109.

Shareholders' funds

The total Shareholders' funds increased to Mio ` 106879 as onMarch 31 2022 from Mio ` 98221 as on March 31 2021 contributed by increase in retainedearnings for the year.

Fixed assets – capital expenditure

The gross fixed asset value (including Capital Work-In- Progress) as onMarch 312022 was Mio ` 40948 compared to Mio ` 37041 as on March 31 2021. The Companymade capital investments of Mio ` 3023 during the year under review with major spend onthe plant and machinery and construction of BOSCH learning Centre.

Investments

The total investments (excluding investment in property) as on March31 2022 was Mio ` 54902 (Current & Non-Current) as against Mio ` 51353 as on March31 2021.

Working capital Inventories

Inventory as on March 31 2022 increased by 33% to Mio ` 17293 fromMio ` 12985 as on March 31 2021. The increase is mainly on account of increase in salesvolume compared to previous year.

Trade receivables

Trade receivables as on March 31 2022 stood at Mio ` 15267 as againstMio ` 13894 as on March 31 2021. The increase is in line with increased sales.

Cash and Bank balances

The total cash and bank balances as on March 31 2022 was Mio ` 17054(including cash and cash equivalent of Mio ` 1432) compared to Mio ` 24506 (includingcash and cash equivalent of Mio ` 2889) as on March 31 2021. The money liquidated wasutilized towards additions to Property Plant and Equipment and lending additionalinter-company loans.

Key Ratios:

Ratio 2021-22 2020-21
Average Trade Receivables (in days) 46 54
Average Inventory (in days) 50 49
Interest Coverage Ratio (percent) ? NA NA
Current Ratio 1.94 1.95
Debt Equity Ratio (percent) ? NA NA
Operating Profit Margin (percent) 9.8% 8.4%
Net Profit After Tax (percent) 10.5% 5.1%
Return On Capital Employed (ROCE) 14.2% 13.4%
(percent)-before tax and exceptional items
Return On Net Worth (RONW) 11.4% 4.9%
(percent)-after tax and exceptional items
Working Capital (No. of days) 131 147

?The Company does not have any interest-bearing debts borrowings orlong term liabilities.

3.5 Human Resource Development and Industrial Relations 3.5.1 HumanResource Development

Technology competition and the external environment are disrupting allof BOSCH's businesses—core adjacencies and edge transformation. In futurevolatility will be the norm. Double-digit growth will be hard fought for and operationalefficiencies alone will no longer be the lifeline. Key to powering and scaling businesstransformation is a workforce that is ready to meet the demands of the new future.

Recognising this business imperative we saw focus on Talent Strategyin all locations to build nurture and develop talent i.e. Fit-for-future. This meansembracing vastly different culture capability and experiential paradigms and making theuncomfortable but necessary mindset shift from the traditional to the agile and from thelegacy to the entrepreneurial.

The strive to attract and retain the best talent has been our biggestchallenge in 2021 and continues to be our complete focus in this year too. Here providingan extraordinary Employee Experience can have a significant impact and we have togethermade progress in this direction across locations. The concerted efforts on this topicshowed results in 2022 where Bosch Limited has been recognized among one of the Best inAuto & Auto Components in India by the Great Place To Work Institute.

In this year we are pursuing our efforts across 6 dimensions:

(a) Talent Strategy – future-focussed business driven approach to meetdifferential Talent needs. This program comprising of cross-functional leaders and talentfocusses on delivering organization and talent readiness for the future of businessescreating delightful talent experiences and building HR capabilities for the future

(b) Learning & Leadership Development - build future-ready competencies &nurture transformational capabilities

(c) Smart Work – Deployment of a hybrid working model and policy that providesflexibility work-life balance safeguard the interests health and safety of allemployees while successfully managing business continuity employee productivityoptimizing workspace and creating opportunities for more diverse and inclusive teamsacross locations

(d) HR Digitalization – develop a holistic road map to build connected solutionsthat enable in-sighting and key decisions on people matters

(e) Employee Experience – Recognition as one of the Best in Auto & AutoComponents in India and systematic pursuit of further actions necessary in our journey todeliver extraordinary employee experience

(f) Diversity Equity & Inclusion – Scaling up our efforts onDEI dimensions such as Gender and People with Disability As we enter Q3-2022 with optimismand passion we are focussing on maximising people potential people experiences andcreating an environment that enables employees to contribute to the long-term success.

3.5.2 Industrial Relations / Employee Relations

Transition from Industrial Relations to Employee Relations continued inall units and plants through continued employee engagement and increased collaborationleading to cordial Employee Relations atmosphere in all plants. The long-term wagesettlement for manufacturing facilities is in vogue with a major focus on costcompetitiveness through various interventions like Maximum Job value performance relatedpay and flexibility to be Fit for Future. Recently Jaipur plant has concluded thesettlement with tripartite settlement during May 2022. The long-drawn negotiations andconclusion of settlement in a fair and firm manner ensures and strengthen our journey witha focus on "Fit for Future".

Because of slowdown in automotive market until 2020-21 restructuringwas initiated wherein around 1700 blue-collar associates from all major plants viz.Bidadi Nasik Naganathapura and Jaipur have availed the early voluntary retirementscheme. This has resulted in improved flexibility in all plants with flexibility ratio ataround 45% on an average making the plants more flexible and agile for the future.

We at Bosch have Employee Relations environment with highly engaged andcollaborative culture in all manufacturing and business units. Each of our plant createsan Employee Relation Strategy guided by Employee Relation Policy of the company. EmployeeRelations strategy is mainly based on:

(a) Employment (labour) model: Performance oriented labour model. Enabler forlocalization and future business growth. Implementation of MJV (Maximum Job Value) andDigital performance assessment system

(b) Front Line Managers Development: Exclusive Training model supported by awell-established TQS to enhance the skills and competencies of Front-Line Managers to be‘Fit for future'

Partenering with various external institutes we conducted manyprograms for union members and opinion makers to facilitate and ensure they are wellinformed about the business. Bosch has received accolades - 2nd NHRDN PEOPLEFIRST ACE WARD 2021 in the category of "Employee Relation". The award waspresented during NHRDN National conference.

As a part of people obsession our Blue-collar workers have againparticipated in initiatives like Great Place to Work to express their views andperception. During the 2022 survey the Trust index scores have improved by 28% andOverriding statement score went up by 15%. Bosch is certified as ‘Great Place towork' for the second time. To further strengthen the employee relations manyengagement initiatives have continued with a structured calendar. The year also sawincreased connect with Government and statutory bodies stringent compliance monitoringthrough self-audits and cross-audits etc. The company received appreciation from variousstakeholders for its excellent practices and approach in the domain of Employee Relationsfocusing on engagement collaboration and trust building.

With the spread of third wave of pandemic care was taken to protectemployees and their family members. Company continued to care by arranging vaccinationcamps for all employees and their family members to insulate them from getting exposed tothe spread of pandemic. All Boschlers across locations showed great maturity andcollaboration in handling the situation and have taken utmost care to curtail infectionsto any of the employees. The Management and Union collaborated to ensure highest safetyfor its employees and business continuity and sustainability. Health and safety of ouremployees has always been at the top of mind for us.

3.6 Internal Audit and Internal Financial Controls

The Company has an Internal Audit function. The Internal Auditdepartment provides an appropriate level of assurance on the design and effectiveness ofinternal controls its compliance with operating systems and policies of the Company atall locations. Based on the internal audit report process owners undertake correctiveactions in their respective areas and thereby strengthen the controls. Significant auditobservations and corrective measures thereon are presented to the Audit Committee.

The Company has an effective and reliable internal financial controlsystem commensurate with the nature of its business size and complexity of itsoperations. The internal financial control system provides for well-documented policiesand procedures that are aligned with Bosch global standards and processes adhere to localstatutory requirements for orderly and efficient conduct of business safeguarding ofassets detection and prevention of frauds and errors adequacy and completeness ofaccounting records and timely preparation of reliable financial information. This alsoidentifies opportunities for improvement and ensures that good practices are imbibed inthe processes that develop and strengthen the internal financial control system andenhances the reliability of the Company's financial statements.

The Audit Committee reviews the internal audit plan adequacy andeffectiveness of the internal control system significant audit observations and monitorsthe sustainability of remedial measures. It also reviews functioning of the Whistle Blowermechanism and reviews the action taken on the cases reported.

The efficacy of the internal checks and control systems is validated byself-audits and verified by internal as well as statutory auditors.

3.7 Opportunities and Threats

While the Economy reeled under the grip of Covid-19 in the past twoyears and there has been substantial reduction in the number of active cases today thereare still uncertainties around robust economic recovery due various other influencingfactors. The Ukraine crisis Semiconductor shortages and the supply chain disruptioncontinue to weigh on the Economy in general and the Automotive sector in particular. TheIndian automotive industry has been witnessing roller coaster ride for nearly two yearsnow and growth challenges still remain. Skyrocketing of Oil prices has predictably causedhigher inflation thereby having an impact on the growth in the short-term. On top of itautomobile sales are extremely sensitive to interest rates. The Company welcomesGovernment's intervention of reducing the excise duty on Petrol and Diesel andcommitment to look into customs duty for the products where import dependency is high.

The Union Budget 2022-23 focused on growth and all-inclusive welfarepromoting technology-enabled development energy transition and climate action.

Large outlays on Production Linked Incentive (PLI) schemes for ChampionSectors is expected to further enable investment and growth. Auto PLI scheme is a uniquepolicy that supports Advanced Automotive Technology (AAT) by incentivizing technology thatreduces emission and CO2 footprint and promotes safe and sustainable mobility. It is agreat opportunity for the country to bridge the gap which otherwise normally exist withthe developed nations. The Company had applied for the Auto PLI scheme and the applicationhas been selected thereby paving way for wider manufacturing footprint for the Company inthe future. Upgradation of infrastructure and e-Commerce is expected to play a big roletoo post Covid-19. Buildings and workplaces need to become smarter. Security and analyticson top of existing products will play an important role. This will bring opportunity forthe Company's Beyond Mobility divisions dealing in domains like Building Technologyand Consumer Goods (Power Tools).

The Company welcomes the announcement and the budget outlay by GOI onthe Mega Multi modal connectivity push also called the Gati Shakti. The multi-modalconnectivity is expected to provide integrated and seamless connectivity for movement ofpeople goods and services from one mode of transport to another. This infrastructure pushfrom GOI is expected to have a multiplier effect on the economy enabling growth in manyadjacent sectors. Alongside the possible reduction in logistics cost it is expected tohelp the Company in expanding its footprint in not only the Mobility sector but alsoIndustrial Technology Consumer Goods and Energy and Building Technology.

Under the Green Hydrogen push by the GOI there was a Joint Declarationof Intent (JDI) on Green and Sustainable Development Partnership under which Germanyagreed to make an advance commitment of 10 billion euros of new and additionaldevelopmental assistance to India until 2030. Bosch guided by its mission statement"Invented for Life" is committed to sustainability. Bosch is investing inHydrogen based technologies – both for mobility and stationery applications. Based onthe evolution of the Hydrogen market in India the Company would bring appropriatetechnologies into the Country.

As expected two and three-wheelers are the early adopters ofelectrification. This is gradually moving towards fleet passenger cars but the InternalCombustion Engine (ICE) is expected to be the dominant technology in the remainingsegments. Bosch with its focus on environment continuous research and improvements inconventional ICE technology and applications has been able to achieve even lower emissionsthan what is mandated. Other key areas of focus which is emerging is around assetutilization and use of analytics in Mobility. To cater to these new age businesses theCompany had created agile project houses on Electrification and Mobility Services.Hydrogen as a focus area has now been added into these project houses. These Projecthouses will enable the Company to understand the local requirements and use the globalexpertise to provide localized solutions for the Indian market.

3.8 Risks and Concerns

Following are the major risks reviewed by the Risk Management Committeeand with applicable mitigation measures:

a) Supply chain risk: We rely on third parties for sourcing rawmaterials parts and components used in the manufacture of our products. Ability to supplycomponents to manufacturing operations at the required time is key to successfulproduction schedules. Due to various reason we witnessed shortage in few components whichconstitute as an essential to manufacture and supply our products to our customers.However respective business unit teams undertake a comprehensive production schedule andare aligned with the customer demand.

b) Pandemic and Geopolitical risk: COVID 19 related risk continuesand we foresee exposure in case of lockdown in other countries resulting in to eitherdelay in delivery or increase in cost of sourcing. in addition to this ongoing Ukrainecrises has its impact on Raw material price and logistic cost. We continue to closelymonitor and risk assess global developments and keep customers updated on progress anddeveloping of alternate strategy to mitigate the risk.

c) Industrial Relations (IR): IR-related risks continue. Theyinclude possible risks arising from stoppage of production and the uncertain result ofsettlement negotiations leading to unpredictable cost structure. IR-related issuescontinue to be dealt with in a fair and firm manner. Initiatives such as strengthening ofthe Front-Line Managers are expected to reduce IR risks in the upcoming settlements.

d) Disruptive norms:

Technological changes: The Indian Automotivesector will witness many new regulations in next few years like CAF? iRDE FAME TREMapart from government's initiative of exploring alternate fuels (ElectrificationNatural Gas Bio-Fuel blend among others). The changes are spread across market segments.With many fuel technology options available for the end consumer identification ofcustomer demand and volume will take more effort and time. Bosch being a global leader inautomotive technology the solution is already available with the parent company. Shift tothese technologies will lead to higher imports content in the initial years. Once thecompany sees an opportunity based on demand or volumes it opts for localization. Theinvestments in machinery for production in Bosch Limited will be at a cost consideringthe technology transfer fee and higher royalty for new products as compared to oldgeneration.

These will also have low replacement requirements in the Aftermarket inthe initial years and will may have an adverse financial impact on the Company.

Electrification: There have been discussions onelectrification by various stakeholders including the Government OEMs media and autocomponent manufacturers with uncertainty on volume and pace of electrification acrossmarket segments. However the Company being a global end-to-end technology solutionprovider in mobility sector has its own advantage and is working closely with some of thetop customers in the industry.

e) Dependency on mobility sector: About 85% of the business isdependent on the auto sector. Performance of the Company therefore is dependent on thissector's growth.

3.9 Outlook

India which is the fourth largest automotive market in the world isset to see a sequential growth in 2022 on strong underlying demand reflecting the generaleconomic recovery and consumers' preference for personal vehicles over publictransportation. On other hand the sector is facing challenges of increase in fuel pricechip shortages weak rural demand. Hence we expect the overall growth to be muted in thisfinancial year.

Deeply impacted by COVID 19 the Indian automotive industry has emergedstronger and shown remarkable resilience. Widespread digitization and technology adoptionfrom source to delivery has played a crucial role in transforming the automotive industry.On the supply side the Production Linked Incentive Schemes namely Auto PLI for AdvancedAutomotive Technology (OEM and Auto Components) Advanced Chemistry Cell Semiconductormission provides much needed boost to the auto industry. FAME II and Scrappage policyhelps in demand generation. These policies collectively promote safe and sustainablemobility.

In this financial year On PC front some respite is seen in theproduction volumes. The Company expects the Passenger vehicle volume to grow in comparisonto the previous year driven by an intermittent improvement in consumer sentiments andcontinued preference for personal mobility although supply chain issues could limit thegrowth.

The CV segment saw a small sequential growth. Macro indicators likeconstruction mining and real estate are very well in place. Also freight availability hasbeen increasing and infrastructure activities are on an up-move.

3W Demand recovery is expected as offices and educational institutionsare re-opening. 2W segment is still struggling to recover from pre-pandemic levels whileposting month-on-month growth. The Company expects Tractor retail sales to remain stablein 2022 amid healthy crop realizations. Overall domestic automobile sales volume isexpected to post a healthy growth in 2022-23 after three consecutive years of decline anddespite the headwinds of high oil price and supply side constraints.

Bosch has a long-term strategy to shape the market in key technologieswith innovative products and solutions. Bosch Limited thus continues its stance to be atechnology agnostic partner to customers government and other stakeholders. For allBosch businesses beyond Mobility Solutions the Company has a two-pronged approach. On theone hand Bosch continues to bring in ‘Fit for market' products and solutionswhile on the other the Company will increase its ‘Go to Market' footprint usingboth offline and digital platforms. The Company will continue to invest in the e-Commercechannel to widen the reach to Customers. Overall with increased private and publicinvestment in infrastructure the outlook is positive for the beyond Mobility businessesof the Company.

4. MANUFACTURING AND OTHER FACILITIES

4.1 Bidadi (Karnataka)

The Bidadi plant in Karnataka is the youngest manufacturing plant inIndia. Located in Bidadi Ramanagara district the entire plant facility is spread over anarea of 98 acres. Being the youngest manufacturing plant it has the capacity to cater tothe futuristic and strategic needs of powertrain solutions business in India. The A-pumpproduced at Bidadi is one of the oldest products of Bosch manufactured in India. Otherproducts manufactured at Bidadi include PF pumps CBx pumps CP4 Common rail glow plugalong with latest addition of Lambda Sensors in its product family.

In last two years Bidadi plant has rapidly transformed itself into alow cost manufacturing destination by restructuring to a flexible labor model. With itscurrent 40% temporary manpower and implementation of advance analytics & i4.0solutions the plant is moving forward in order to become fit for future. From detectingdefects through AI enabled AVIS system to AI based video analytics solution to train andtrack quality from temporary manpower i4.0 is making rapid progress in Bidadi. With afocus on becoming preferred location for diesel & non-diesel products the plant hasrolled out its new vision-2025 "Diesel & Beyond". Enabled by this visionBidadi plant is making strong and sustainable improvements in operational excellence whichis propelled by latest i4.0 solutions smart manufacturing & strong BPS drives likespeed weeks RFID based Kanban system & flow improvements across various valuestreams. With the strategy of "Inspired Minds @work" plant is also focusing oncreating an inspiring & positive leadership improving employee experience to havehighly engaged employees & building a high performance culture. The result of thestrategy is reflected in the increased score in latest GPTW survey where bidadi plant gotthe highest score among large plants. In the quest towards sustainability Bidadi planthas become CO2 neutral since 2020 & has set a target to reduce absolute waterwithdrawal by 25% by 2025 over the consumption in the year 2017. Various Energy analyticssolutions like DEEPsights & AI enabled AHU management systems have helped the plantreduce energy consumption by 15% (678Mwh) for the year 2021. Bidadi Plant bagged the PS2021 Award for "CO2 and Energy Efficiency".

The plant has been also focusing on behavior-based safety through FLMempowerment automation & digitalization of safety measures sustaining ERT conceptand Building safety Competence among employees and contractors. Bidadi plant won theKarnataka State Safety award-2022 & got the Gold prize at 5th CII-IQnational safety competition for its approach on "Hazard Hunt".

4.2 Nashik (Maharashtra)

Nashik Plant manufactures Common Rail Injectors (CRI) and componentsincluding nozzles for both common rail and conventional diesel injectors. During the yearunder review the Plant diversified its product lineup from passenger cars to‘off-high way' applications. In addition the Plant is also certified IATF:16949. The plant has a strong focus on System CIP approach to reach the VSD. Incontinuation with previous year plant has continued its journey of speed week andextensive use of Shainin as a problem solving and cost reduction tool. To improve agilitybased on data culture speed Shainin concept was also developed and bringing in goodresults. Scrum as an agile tool is extensively used in the plant successfully for examplein value addition cost elements control. Systematic focus is given for I4.0 drive withclear PoC success for Opcon and non–Opcon controls. AI and RPA are successfully usedin various areas for reducing non value adding work and achieving speed in tasks The Plantcontinued its endeavor to use renewable source of energy and green initiatives. The Planthas an overall capacity of 13.6 MWp of solar energy generation. The plant is the firstBosch Plant in India and fifth worldwide to receive ISO 50001:2001 certification forEnergy Management. Globally in the Bosch Group Nashik Plant was awarded the best in"Energy Efficiency & Environment Category". Miyawaki based tree plantationhas been done in 700 sq. mts. and more is in the planning around 1700 trees have beenplanted under /Miyawaki concept. The Plant has been focusing on behavior-based safetyreduction of first aid cases and capturing & working on near miss incidents digitally.Bosch Limited Nashik was awarded by VDMA Manufacturing Excellence Award. The plant wasalso awarded by CII for Smart factory low cost automations maintenance circlecompetitions and many more. Nashik plant was awarded in the field of health safety andsustainability by ACMA. Bosch Limited Nashik was also awarded with Greentech SafetyExcellence Award - 2021 under automobile sector. The plant has always been focusing onemployee involvement and engagement through various suggestion schemes and recognitions.Nashik Plant takes care of competency development through various trainings in the fieldof speed and agility lean manufacturing connected industries and data analytics. Planthas improved its statistics on trust index conducted by great place to work. Withdifferent strategies in many areas Nashik plant is growing at a steady pace andattracting new products to its portfolio.

4.3 Jaipur (Rajasthan)

The Jaipur Plant manufactures Distributor (VE) Mechanical andElectronic Control Diesel Pumps and Conventional Injectors (NHA) having applicationsmainly in Light and Heavy Commercial Vehicles tractors and other off-highwayapplications. The plant was established in the year 1999 with VE pump as its first productand started the manufacturing of NHA later in the year 2016. Jaipur Plant also celebratedthe production of 20th million NHA in 2021.Jaipur plant is known for itsoperational excellence and taking a stride forward it also started its digitalizationjourney. Key technologies like MES artificial intelligence and RPA's are beingadopted to make the systems and processes more robust and free from manual interventions.One of the important part of the strategy at Jaipur Plant is to have engaged and energizeemployees. Various initiatives and campaigns are being organized in the plant to keep themorale of its people high. The plant was awarded "Cleverle award" (InternalBosch worldwide award for employee involvement) for the year 2020 for high level ofinvolvement of its employees in giving ideas and suggestions and driving improvementactivities across the plant. Plant has also been identified as the best plant across PSfor employee involvement 3rd time in a row in the year 2021. Safety is ofutmost priority for the plant leadership and as a result the plant is an accident freeplant for the last 4 years. The Jaipur plant is also recognized in the area of"Safety" by the British safety council and they have awarded "InternationalSafety Award" to Jaipur plant.

The plant will become single plant for VE pump manufacturing worldwideafter transfer of VE production from Japan. The activities for this transfer has alreadystarted in 2021 the transfer will be done in a phased manner and it will get completed by2025. As a part of future preparedness the team is working on 3D printing technologywhich will be important considering the complexity varieties and small lot sizes it willbe handling. In 2022 the plant is focusing on building competency for 3D printing andplan to make substantial investments for metallic 3D printing in the years to come.

4.4 Naganathapura (Karnataka)

The Naganathapura Plant produces Spark Plugs a product produced by theBosch group for over a century. The Plant celebrated the "120 Years of existence ofthe Bosch Spark Plug" on 7th January 2022. The Plant became a zero liquiddischarge plant with installation of an evaporator along with a boiler and thereby exceedsthe requirements specified the Karnataka State Pollution Control Board and has become abenchmark for the same. It is a Carbon Neutral plant since July 2020. Productivityimprovement projects were implemented in addition to safety and quality improvementprograms. The plant produced its highest ever volumes in 2021 and is on a transformationjourney of best performance. Digital Transformation is a strategic focus area and thePlant is moving towards improving its digital footprint for Industry 4.0. The Plant isimproving its operational excellence through structured implementation of Bosch ProductionSystem (BPS) together with focus on low cost automation. Naganathapura plant was ratedhighest across all Bosch Plants Locations in India in the Trust Index survey which is oneof the key indicators of "Great Place to Work" initiative.

4.5 Gangaikondan (Tamil Nadu)

Gangaikondan Plant in Tamil Nadu is a proven strategic cost competitivelocation in Asia and has made its presence felt with the competitive labor cost andquality levels that meet IPN standards. The Plant continues to have product portfoliowhich comprises of Gasoline power train sensors Fuel Supply modules Air managementproducts & Fuel Charge assemblies. Business Units like Sensor Division (SU)Components & Connectors (CC) and Gasoline Injection (GI) Diesel Injection (DI) arefurther trying to enhance in-house manufacturing by relocating of lines from otheroverseas locations to support the "Local for Local" strategy. To accommodate newproducts space was not available and GanP embarked on a space generation effort in 2021 tocreate additional space by layout optimization which improved the production spaceutilization from 49% to 64% within a shorter time span of 16 weeks. Ignition coil (ZSK)was newly added in GanP product portfolio which was a customer driven project. Time tomarket was less than 7 months and the project was executed in an agile way and the SOPstarted in advance which was highly appreciated by customer. Parallel projects wereidentified to reduce the MAT cost to be cost competitive which resulted in Insourcing ofLCK (Lid construction Kit) a critical child part of RKLE. Plant received"Excellent" rating from Customers Honda RNAIPL AL and BAL for sustaineddelivery and Quality performance. Our Team won 2nd place in the productivityimprovement competition conducted by National Productivity Council. Associate involvementis one of the focus areas for continuous Improvement and GanP won 3rd placewithin PS Worldwide in employee suggestion category for the year 2021.

4.6 Chennai (Tamil Nadu)

The Power Tools facility admeasuring approximately 8500 sq. meters islocated at Indospace Industrial Park Oragadam Tamil Nadu. At present the facilitycaters mainly to the Indian and SAARC markets. It primarily manufactures Small Anglegrinders Large Angle grinders and Marble cutters Blowers Drills and two-kg Hammersalong with their motors. The Plant produces Blowers for the entire global market. The mainhighlight of the Plant is that 100% of associates on the Assembly lines at the shop floorare women. The Plant is certified for ISO14001:2015 and ISO45001:2018. More than 65% ofconsumption in 2020 was green energy. The Plant was accredited with Power Tools Plantexcellence award for three consecutive year since 2016 and awarded 2nd BestPlant during 2019 within Power Tools international network. Power Tools Plants is oneamong the top 3 Plants across Bosch Plants to have been recognized for Best SafetyPractices [Global EHS award] besides CII Awards for safety and best practices during thepandemic. The Plant achieved a record production volume of > 1.8 mio. Pcs in the year2021 owing to the good market recovery and demand. The plant is also scheduled to berelocated to the new location where ED Plant is existing. The space generation due to EDrestructuring has created space for Power Tools. The entire relocation process isscheduled to be completed by 3Q.2022.

4.7 Smart Campus

2022 marks the completion of Bosch's 100-year journey in India.From nurturing the development of the nation's automotive and manufacturingindustries to the green revolution Bosch India has consistently contributed to thecountry's progress. Building on this significant milestone Bosch inaugurates itsfully artificial intelligence of things (AIoT)-enabled Smart Campus in Adugodi Bengaluru.With an investment of `800 crores made over the last five years this 76-acre campus inthe heart of Bengaluru is Bosch's largest tech center outside of Europe and will hostthe second-highest number of Bosch employees worldwide. From driving insightfulstrategies to agile methods of working and digital initiatives Bosch India is well on itsway to becoming a data-driven improvement organization and will continue to seize thenarrative for the new ways of work. Bosch has conceptualized its smart campus on the threepillars of the Spark.NXT agenda: spark sustainability and future. As a leading supplierof technology and services and an AIoT company Bosch India has leveraged its world-classAI IoT automation and digitalization capabilities to develop this campus to pursue itsvision for a digital sustainable efficient and self-reliant India. The smart campusunderpins Bosch's ability to develop user-centric key solutions and accelerate itscarbon neutrality journey aligned with India's sustainability targets.

Furthering its century-long journey in support of Atmanirbhar BharatBosch has accelerated its digital strategy to make Indian cities smarter greener secureand connected through rapid urbanization and next-generation infrastructure with anincreased focus on localization of our digital portfolio.

5. INFORMATION TECHNOLOGY (IT)

Digital Transformation journey is built on the strong backbone of ITorganization capable of supporting business needs with respect to infrastructure secureand reliable solutions to achieve excellence in operations. Migrating to standardizedcloud solution (M365) has enhanced the collaborative working environment and effectivemail management. It is evident in the way teams collaborate virtually today across theorganisation.

We enabled all the entities with necessary solutions for safe workingduring covid times and also unique requirements e.g. COVID vaccination booking. Wecontinue to enhance our mobile app "Associate Connect" with new features toprovide necessary employee relevant information at fingertip.

In line with the business Value Chain Strategy actions have beeninitiated to harmonize Bosch shop floor IT across plants and integrate the Manufacturingand Supply chain activities with Bosch Manufacturing and Logistics Platform (BMLP). BMLPwill become the backbone of digitalization in our Plants and enable further digitaltransformation topics like Analytics AI and IT-Security.

Digital Core of the organization is future ready with successfulGo-Live of the largest project within Bosch mobility sector "ProjectOneM@India" (Migration to ERP for Mobility Division). This has led to complexityreduction through standardizing the processes and ERP solutions across Bosch mobilitydivisions. This enables the organization towards future initiatives to prepareorganization for data driven decision with single source of truth enable digital businesswhile keeping the running cost of IT optimized.

To keep abreast of the ever-increasing IT security requirements aprogram has been initiated to strengthen the capability to safeguard Bosch ITinfrastructure from future cyber security threat situations. A flexible and secure networksegmentation for business applications with different protection needs is beingimplemented.

Digital Transformation strategy framework was reviewed and re-wired toemphasize on Automation Data Driven decisions People-Capabilities New and emergingbusiness. We have set up center of excellence for intelligent automation to accelerateautomation adoption across the organisation. Other topics under focus for buildinghorizontal capabilities are analytics and cloud applications. With this Spark.DIGITAL wecontinue our journey as a Digital enterprise holistically focusing on Product ProcessPeople and foundation as key pillars.

We have built integrated business solutions which brings visibility andbuilds transparency into the entire supply chain operations in the area of transportationmanagement and warehouse management. Solution deployed successfully uses intelligentautomation advance analytics and blockchain enabled applications to drive business value.

Enhancing Digital Fluency in Bosch way!

Building Digital fluency in everything we do is a continued journey ofwhich last year was spent on building Digital Fluency of our people for accelerating ourfuture. Program was designed and executed as an inclusive program aimed at developingknowledge of digital relating to their respective function for all associates of BoschIndia covering everybody from bottom of pyramid to top of the pyramid in organizationstructure. Thereof we have built advanced level competencies within chosen 130+ DigitalPioneers focused on application of digital in their own functional area.

Change management and communication with all the stakeholders werebuilt-in as an integral part of the program. There is no Digital Transformation withoutthe culture and mindset transformation!

80000+ hours direct learning as part of the program sparking continuouscommunity learning has led towards

Digital Skill Quotient change from beginner level to intermediate/advancelevel towards the end of the program. We strongly believe in talent over Technologyand emphasize on continuous learning.

130+ Digital Pioneers undertook further rigorous training focused onautomation analytics and agile project management to prepare themselves for theapplication of their learning towards Digital Transformation. These pioneers explored insmall cohort's various possibilities of Digitalization in their respective functionsand identified through Action Learning projects and now they are getting integrated intoDigital Transformation journey of the organization.

Overall impact of the program can be seen in multi dimension as below:

6. CHANGE INITIATIVES

6.1 Manufacturing Strategy

In June 2020 a comprehensive manufacturing strategy was launchedacross Bosch with a purpose of making Bosch India manufacturing globally competitive. Wedefined our vision statement as ‘We Make India a Global Manufacturing Hub' whichalso complimented Indian National Government's Aatmanirbhar Bharat initiatives.Starting 2022 we extended scope of our strategy to cover entire value chain. We havemerged manufacturing strategy and supply chain strategy which was otherwise runningparallel to have one holistic comprehensive value chain strategy with a vision to makeIndia a preferred global value chain partner.

Our Mission – We. Perform. Transform is a sentence in itselftowards reorienting our manufacturing and supply chain process in India. Value chainstrategy has 12 strategic action fields with defined KPIs and KPRs focusing on value chainexcellence collaboration and leadership topics.

6.2 i4.0 in RBIN

Connected Industry (i4.0) is speed boaster for production performanceand it is one of the key strategic pillar for Now Next and Beyond. Under Vale ChainStrategy – Connected Value Chain is one of the strategic action field to strengthenE2E connectivity(KPI : % connectivity and Digital assessment index) Analytics platformto build use case for business benefits and Standard solutions for improving maturityacross manufacturing plants for benchmarking performance.

6.3 Bosch Production System (BPS)

BPS in Value Chain is one of the strategic action field in our ValueChain Strategy. Through this focus is to promote Intrapreneurship Race to Result andFlexible Manufacturing systems.

Value stream Business requirements are collated as per BPS improvablesystem framework. The whole year Business performance targets are sliced into 4 quartersand projects thereby are identified. These SCIP projects are then implemented within 2months. To ensure sustenance of measures Point CIP is conducted. Source and Deliver teamsare also involved to implementing SCIP projects. To enable faster realization of projectsDigitalization enablers like My Measures MES are installed to give more transparency andfaster decision making. This helps to achieve Business performance target in an efficientmanner. In order to increase speed and agility SCIP projects are also conducted as Speedweeks. The results are fast tracked as the project realization is within 5 days. This ispossible by CFT team and guided by a Coach. There are now more than 40 + Speed weekCoaches who are groomed to handle complex projects. Focus is given to improve Machineutilization (OEE) Reduce Change over time improve productivity reduce Lead time formanufacturing and thereby meet the expectations of the Customer and business case.

In order to implement a continuous improvement culture acrossorganization monthly immersions called "System CIP: Be Inspired" and "Shareand Learn" is introduced as an experience sharing platform across Bosch entities.Objective is to exchange ideas increase belief system and aim for Benchmarking practices.

To improve productivity and Flexbility in Assembly lines Standardisedwork concepts and Line Balancing techniques are being imparted by an experienced team thruGemba based learning model. This hands-on learning model helps to understand the conceptsin a better way and improvement potentials are identified quickly and thereby actions arecompleted swiftly.

6.4 Carbon Neutrality

Bosch sees itself as a pioneer in climate action and has anchored thisaspiration in its sustainability vision. The corresponding strategy includes four levers:improving energy efficiency generating more energy from renewable sources expanding thepurchase of green electricity and – as a last resort – offsetting unavoidableCO2 emissions with Carbon credits.

Bosch limited has adopted a systematic 4E (Energy Audit Energyre-tuning Energy Lifecycle and Energy Culture) approach. Across India 8 locations willbenefit from improved energy efficiency projects. The target is to realize 2% reductionyear on year.

Under the banner of new clean power Bosch aims to drive renewableenergy generation – both through in-house generation at its company locations andthrough long-term supply contracts that will ultimately enable the external constructionof new photovoltaic plants and wind farms. The installation of more than 23 MW in-housesolar power plants at Indian sites has resulted in 31 GWh of renewable power whichfulfils 21% of the total energy requirement of Indian sites. Further increasing theoverall green energy content by 22% through group captive business model will add capacityto the ecosystem by building renew-able energy sources thereby reducing carbon footprint.

At the same time we are broadening the focus of our activities toalso reduce emissions produced outside Bosch's direct sphere of influence forexample at suppliers in logistics or when our products are used – known as scope 3emissions. We want to reduce these upstream and downstream emissions by 15% in absoluteterms by 2030.

6.5 Safety

Bosch strives to motivate associates to integrate safety measures intheir lives and educate others about those measures. Maintaining and promoting the health& safety of our employees is a very high priority at Bosch. We want to preventaccidents and illnesses from happening in the workplace.

At Bosch we are driving Value Chain Strategy (VCS) where one of thekey strategic action field is the topic of "Zero Accident". This strategy has 3pillars: 1. Mindset 2. Responsibility & 3. Engagement.

Under mindset the objective is to reinforce safety culture acrossdifferent levels. The initiative of learn to see trains the employee to observe unsafeacts and unsafe conditions which would enable reporting of near miss cases.

Front Line Manager (FLM) empowerment is an initiative which empowersand motivates the line managers to enhance the safety culture within their respectiveareas of responsibilities.

Near miss capturing will continue to be the focus across all locations.During the year 2021 more than 9000 near misses were captured. This has resulted indeploying about 5800 improvement measures across locations to realize next level ofmaturity in terms of work safety.

6.6 Quality Management

‘Zero Defect' as base for success continues to be the primefocus in the transformation journey under Value chain strategy. Scope is now extended toour supplier partners as well and logistics quality in addition to Manufacturing there bycovering entire value chain.

Strategic action field focusses mainly on Customer First initiativesRobust Value Chain and Problem preventing company. Enthusiastic team from across BoschIndia is coming together to focus and improve on 9 sub strategic action fields with aclear KPIs to track the progress and adapt.

Proactive connect with customers by leadership team thro' levelledcalendar is going on well with customers leading to improved customer perception.

With plants adapting to flexible labour model there is a high focus ontraining and handholding for the new associates to ensure that relevant processes arefollowed and adhered. Quality mindset drive focusing on 14Q basics FMEA line walksPokaYoke campaigns etc. have been planned and followed to finish.

As future focus data analytics is being driven across Bosch India tofocus on competency enhancement and also use of abundant data that is available to preventdefects.

There has been a 17% reduction in ‘0' km customer incidencesin 2021 over previous year (OPY). Logistics incidences were reduced to the tune of 52%(OPY). Internal defect cost was reduced by 10% (OPY).

7. AWARDS AND RECOGNITION

During the year under review the Company won several awards forexcellence. Few such awards are:

Business Award

(a) EV State Summit Business Award at the EV State Summit (Mobility Cloud PlatformTeam).

Manufacturing & Quality Awards

(a) Quality Circle competition at TATA Motors (Nashik Plant)

(b) Golden peacock award for quality circle forum of India (Gangaikondan Plant)

(c) VDMA Manufacturing Excellence Award - Work Condition and Work Safety

(d) Dorian Shainin Global award ( 2 nos) for Problem solving.

Productivity Awards

(a) RE National Low-Cost Automation (LCA) Circle Competition CII Award (Nashik Plant)

(b) PY competition in northern region organized by ACMA (Jaipur Plant)

(c) CII National Lean Competition 2021 Using Lean for productivity enhancement (JaipurPlant)

Customer Awards

(a) Best Supplier in Engine Proprietary Farm Division by Mahindra & Mahindra Ltd.

(b) Excellence Award for BS6 Development by Mahindra & Mahindra Ltd.

(c) Regional Supplier Samrat (Nashik Plant) by Ashok Leyland.

(d) Supplier Quality Improvement Contest (Nashik Plant) by Kirloskar Oil EnginesLimited.

(e) Advance Problem-Solving Project 2021-2022 (Nashik Plant) by Ashok Leyland.

Sustainability & EHS Award

(a) (Automotive Component Manufacturers Association of India (ACMA) AtmanirbharExcellence Awards 2021 – Winner" under HSS (Occupational Health Safety &Sustainability)

(b) Greentech Safety India Award 2021

(c) Manufacturing Today Conference & Awards 2021 – for excellence in worksafety in 2021

8. DIRECTORS AND KEY MANAGERIAL PERSONNEL

8.1 Directors Retiring by Rotation

In accordance with the provisions of the Companies Act 2013 andArticles of Association of the Company Mr. Sandeep N (DIN: 08264554) retires by rotationat the forthcoming Annual General Meeting and being eligible offers himself forre-election at the said Meeting.

Brief profile of Mr. Sandeep N. forms part of the Notice convening the70th Annual General Meeting of the Company.

8.2 Changes in the Board and Key Managerial Personnel 8.2.1 Board ofDirectors

Dr. Bernhard Straub (DIN: 06654241) resigned as a Chairman and Directorof the Company with the close of business hours on May 202021 due to change in area ofhis responsibility at global level. The Board appointed Mr. Markus Bamberger as theChairman of the Board with effect from June 11 2021. Mr. Bernhard Steinruecke (DIN:01122939) resigned as an Independent Director with the close of business hours on May 202021 due to his preoccupation. Mr. Steinruecke has confirmed that there are no othermaterial reasons other than those stated by him in his resignation letter.

Based on the recommendations made by the Board of Directors in itsmeeting held on May 20 2021 the shareholders in its 69th Annual GeneralMeeting approved the following: (a) Appointment of Mr. Markus Bamberger (DIN: 09200475) asa non-executive director of the Board with effect from June 11 2021;

(b) Appointment of Dr. Pawan Kumar Goenka (DIN: 00254502) as an Independent Directorfor a period of 5 years with effect from May 21 2021 till May 20 2026; and

(c) Re-appointment of Mr. S.V Ranganath (DIN: 00323799) as an Independent Director ofthe Company for a further period of three years with effect from July 01 2021 to June 302024.

The Board further appointed Mr. Bhaskar Bhat

(DIN:00148778) as Lead Independent Director from May 21 2021 to March31 2024. The appointment is made in furtherance of Company's commitment to goodcorporate governance practices.

Mr. S.C. Srinivasan (DIN: 02327433) conveyed his decision to opt forearly retirement with effect from April 01 2022 and resigned from his position as JointManaging Director and Chief Financial Officer of Bosch Limited with effect from January01 2022.

The Board of Directors at its meeting held on January 17 2022appointed Ms. Karin Gilges as the Chief Financial Officer of the Company with effect fromMay 01 2022.

The shareholders approved the re-appointment of Mr. SoumitraBhattacharya (DIN:02783243) as the Managing Director of the Company for a further periodof 1 (One) year from July 01 2022 to June 30 2023 and appointment of Mr. GuruprasadMudlapur Chief Technology Officer (DIN:07598798) as Joint Managing Director for a periodof 3 (Three) years with effect from February 09 2022 to February 08 2025 throughresolutions passed by Postal Ballot on April 07 2022.

Effective January 01 2022 Dr. Stefan Hartung was appointed asChairman of the Board of management of Robert Bosch GmbH. Due to increase in hiscommitments owing to change in his responsibilities at global Bosch Board of ManagementDr. Stefan Hartung has tendered resignation from his position as a Non-executive Directoron the Board of Directors of the Company effective from July 01 2022.

Based on the recommendation of the Nomination & RemunerationCommittee and subject to the approval of shareholders wherever applicable the Board ofDirectors has at its meeting held on May 19 2022 approved the following changes to theBoard of Directors:

(a) Appointed Ms. Padmini Khare (DIN: 00296388) as an Independent Director for a periodof 5 years with effect from May 19 2022 to May 18 2027;

(b) Re-appointed Ms. Hema Ravichandar (DIN: 00032929) as an Independent Director of theCompany for a second term of five years with effect from September 02 2022 to September01 2027;

(c) Appointed Ms. Filiz Albrecht (DIN: 0009607767) as Non-Executive Director witheffect from July 01 2022.

(d) Appointed Ms. Karin Gilges(DIN: 0009615158) as an Alternate Director to Ms. FilizAlbrecht with effect from July 01 2022.

(e) Appointed Mr. Karsten Mueller (DIN:08998443) as Whole Time Director of the Companyfor a period of 3 years with effect from July 01 2022 to June 30 2025.

Brief profiles of Ms. Hema Ravichandar Ms. Padmini Khare Ms. FilizAlbrecht and Mr. Karsten Mueller form part of the Notice convening the 70thAnnual General Meeting of the Company.

8.2.2 Key Managerial Personnel Managing Directors

Mr. Soumitra Bhattacharya has been re-appointed as the ManagingDirector from July 01 2022 to June 30 2023 and Mr. Guruprasad Mudlapur ChiefTechnology Officer has been appointed as Joint Managing Director for a period of 3 (Three)years with effect from February 09 2022 to February 08 2025.

Whole-time Directors

Mr. Sandeep N. was appointed as an executive director for a period ofthree years from February 12 2021 till February 11 2024. Mr. Karsten Mueller has beenappointed as an Alternate Director to Dr. Stefan Hartung and as a deemed Whole-timeDirector for a period of three years with effect from February 12 2021 to February 112024.

The Board has in its meeting held on May 19 2022 appointed Mr. KarstenMueller as Whole Time Director of the Company for a period of 3 years with effect fromJuly 01 2022 to June 30 2025.

Chief Financial Officer

Mr. S.C. Srinivasan resigned from his position of Chief FinancialOfficer with effect from January 01 2022. The Board of Directors in its meeting held onJanuary 17 2022 appointed Ms. Karin Gilges as the Chief Financial Officer from May 012022.

Company Secretary

Mr. Rajesh Parte resigned from his position as the Company Secretaryand Compliance Officer with effect from September 24 2021. Ms. Divya Ajith was appointedas the Compliance Officer from September 24 2021 and subsequently appointed as theCompany Secretary from February 09 2022 as an interim measure to fill the vacancy in the2 (two )positions. The Board has in its meeting held on May 19 2022 appointed Mr. V.Srinivasan as the Company Secretary from May 20 2022.

As on the date of this report the following persons have beendesignated as the Key Managerial Personnel of the Company pursuant to Section 2 (51) and203 of the Companies Act 2013 read with the Companies

(Appointment and Remuneration of Managerial Personnel) Rules 2014:

(a) Mr. Soumitra Bhattacharya - Managing Director

(b) Mr. Guruprasad Mudlapur - Joint Managing Director and Chief Technology Officer

(c) Mr. Sandeep Nelamangala - Executive Director

(d) Mr. Karsten Mueller- Alternate Director to Dr. Stefan Hartung (deemed Whole-timeDirector)

(e) Ms. Karin Gilges- Chief Financial Officer

(f) Ms. Divya Ajith - Company Secretary & Compliance Officer

8.3 Independent Directors and Lead Independent Director

All the independent directors of the Company meet the criteria ofindependence as provided under sub-section (6) of Section 149 of the Companies Act 2013and Regulation 16(1)(b) of SEBI(LODR) Regulations 2015. Declarations to this effect havebeen received from them. The Independent Directors of the Company have registeredthemselves with the databank maintained by the Indian Institute of Corporate Affairs("IICA") and are either exempt from the requirement to undertake onlineproficiency self-assessment test or passed the same. The Board is of the opinion that allthe Independent Directors are persons of integrity and possess relevant expertise andexperience (including proficiency). The Board of Directors at its meeting held on May 192022 based on the recommendation of Independent Directors appointed Mr. Bhaskar Bhat asthe Lead Independent Director.

As the Lead Independent Director he shall be responsible for thefollowing:

(a) Lead exclusive meetings of the IDs and provide feedback to the Chairperson/Board ofdirectors after such meetings;

(b) Serve as liaison between the chairperson of the Board and the IDs;

(c) Have the authority to call meetings of the IDs; and

(d) If requested by shareholders (case to case basis) ensure that he/she is availablefor consultation and direct communication.

8.3.1 Familiarization Programme for Independent Directors

The Company familiarizes its Independent Directors with their rolesrights responsibilities in the Company nature of the industry in which the Companyoperates etc. through various programmes. These sessions are delivered upon induction ofa new Director as well on an ongoing basis Regular presentations are made at the BoardMeetings by the Executive Directors and other Senior Management persons which gives anopportunity to the Directors to interact with the Management and get an overview of theoperations and familiarize with matters related to the Company's values andcommitments. The Directors are provided with all information on regular basis to enablethem to have a better understanding of the Company its operations and the industry inwhich it operates. The Directors are also made aware about their roles andresponsibilities on regular basis.

For details of familiarization programmes of the Independent Directorsand number of hours please refer to the Corporate Governance Report.

8.4 Performance Evaluation of Directors

In line with the provisions of the Act and the Listing Regulations theNomination & Remuneration Committee and the Board have carried out an annualperformance evaluation of its own performance Committees and individual Directors.

For details of the performance evaluation including evaluation criteriafor Independent Directors please refer the Corporate Governance Report.

9. BOARD MEETINGS

During the year under review five(5) meetings of the Board ofDirectors were held. The particulars of the meetings and attendance thereat are mentionedin the Corporate Governance Report.

10. CORPORATE SOCIAL RESPONSIBILITY (CSR) COMMITTEE AND INITIATIVES

As on the date of this report the CSR Committee comprises of Mr.Bhaskar Bhat (Independent Director) as its Chairman Ms. Hema Ravichandar (IndependentDirector) Mr. S.V. Ranganath (Independent Director) Dr. Gopichand Katragadda(Independent Director) Mr. Soumitra Bhattacharya (Managing Director) and Dr. Pawan KumarGoenka (Independent Director) as its members.

The CSR Committee oversees the Company's CSR initiatives.

Details of the CSR Committee meetings and attendance thereat forms apart of the Corporate Governance Report. The Board of Directors at its meeting held on May20 2021 amended the CSR policy in line with the provisions of the Companies Act 2013 andthe Companies (Corporate Social Responsibility Policy) Amendment Rules 2021. The CSRpolicy inter-alia deals with the objectives of the Company's CSR initiatives itsguiding principles thrust areas responsibilities of the CSR Committee implementationplan and reporting framework.

Some of the key CSR initiatives during the year under review includethe following:

BRIDGE (Bosch's Response to India's Development & Growththrough Employability Enhancement)

Under this unique vocational training initiative less-educated youthare reached out to and are imparted industry-relevant short-term skills developmenttraining leading to their entry-level employment in the service industry. This programhelps lesser-privileged unemployed youth get suitable employment soon after the programcompletion. It is a three-month program with two months of classroom training and onemonth of On-the-Job Training (OJT). Bosch has also taken the initiative to train &create a pool of caregivers under its paramedics training program. In totality 6600 youthgot benefited across India during the year despite of pandemic.

Skill Entrepreneurship

The Skill Entrepreneurship program was conceptualized by Bosch in theyear 2021. As defined by Bosch "Skill Entrepreneurship is a form of entrepreneurshipwhich offers an opportunity to young professionals for developing their own trainingstart-up both in the interest of giving back to society as well as to create a revenuegeneration business model." As an outcome 100 skill entrepreneurs have started theirskilling centers pan India & each Skill Entrepreneur can train 100 youth every yearadditionally through this initiative a capacity to train 10000 candidates has beencreated and more youth will benefit from this program. Bosch field team had extensivelyworked on ground to identify the right set of audience/candidates like freelance trainersskill trainers etc. for Skilling Entrepreneurship program.

Rural Micro-Entrepreneurship

The objective of this program is to identify rural youth & womento impart relevant skills which would make them employable & enterprising. Throughthis initiative Bosch is creating rural micro entrepreneurs in the areas of AutomotiveAyurveda and Beautician trainings. So far 400 youth have benefitted from the program panIndia.

NGO Capacity Building

Bosch has conceptualized a program called the "NGO CapacityBuilding Program" to enhance knowledge awareness and basic skills of participantsregarding NGO/ NPO governance management and its sustainability. This program aims tostrengthen the organization to increase its effectiveness and social impact and achieveits goal and sustainability vision over time. 200 NGO's have benefitted from thisprogram.

Cataract Surgery Program

The cataract surgery by Bosch has been designed to support the ruralelderly who face the issue of cataract. In 2021-22 more than 2315 deserving and needybeneficiaries have benefitted from this program. Bosch partnered with LAICO (Lions AravindInstitute of Community Ophthalmology) the training and consulting arm of Aravind Eye CareSystems which is one of the best institute in the country & has received globalaccreditation for its work and services. The surgeries are done at highly subsidized costswhich includes both pre-operative and post operative medication.

Combating COVID and Other continuing projects:

Combating COVID-19 was the major focus of the Company during the year2021-22. The support enabled many hospitals to get COVID essentials like Oxygenconcentrator & units medical equipment's ventilators repair provision of ICUbeds arrangement of covid essentials like PPE Kits masks Sanitizers in Bosch Plants atJaipur Nashik Bidadi Chennai & Gangaikondan.

Annual Report on Corporate Social Responsibility Activities of theCompany is enclosed as Annexure ‘A' to this Report.

11. AUDIT COMMITTEE

As on the date of this report the Audit Committee comprises of Mr.S.V. Ranganath (Independent Director) as its Chairman Mr. Pawan Goenka (IndependentDirector) Mr. Bhaskar Bhat (Independent Director) Ms. Hema Ravichandar (IndependentDirector) Mr. Markus Bamberger (Non-Executive Director & Chairman) and Dr. GopichandKatragadda (Independent Director) as its members.

The Members of the Committee possess accounting and/ or financialmanagement knowledge and expertise. The Company Secretary of the Company is the Secretaryof the Committee.

During the year under review the Board accepted all therecommendations of the Audit Committee.

In pursuance of the amended SEBI Listing Regulations effective fromJanuary 01 2022 members of the audit committee who are Independent Directors approve therelated party transactions.

Details of the roles and responsibilities particulars of meeting andattendance thereat are mentioned in the Corporate Governance Report.

12. SUBSIDIARY ASSOCIATE AND JOINT VENTURE COMPANIES

12.1 Subsidiary Companies

MICO Trading Private Limited (MTPL)

Highlights of performance of Company's subsidiary i.e. MICOTrading Private Limited (MTPL) and its contribution to the overall performance of thecompany during the period under report:

(TINR)
Particulars FY 2021-22 FY 2020-21
Total Revenue 52 61
Profit/(Loss) before tax (15) (16)
Profit/(Loss) after tax (15) (16)

The Audited Statement of Accounts of MTPL can be accessed on thewebsite of the Company at www.bosch.in under the "Shareholder Information"section.

Robert Bosch India Manufacturing & Technology Private Limited(RBIM)

Robert Bosch India Manufacturing & Technology Private limited wasincorporated on May 31 2020. RBIM is a manufacturer of automotive products and all kindsof motors automotive machinery and electrical machinery.

Highlights of performance of RBIM and its contribution to the overallperformance of the company during the period under report:

(TINR)
Particulars FY 2021-22 FY 2020-21
Total Revenue - -
Profit/(Loss) before tax (1550) (18014)
Profit/(Loss) after tax (1550) (18014)

The Audited Statement of Accounts of RBIM can be accessed on thewebsite of the Company at www.bosch.in under the "Shareholder Information"section.

12.2 Associate Company

Newtech Filter India Private Limited (NTFI)

The Company holds 25% and Robert Bosch Investment Nederland B.V. holds75% of the paid-up share capital of Newtech Filter India Private Limited.

NTFI is the manufacturer of automotive filters selling their productsto the Company which further sells the same to end customers. NTFI has successfullyramped up fuel filters for BS6 applications.

The financial performance of NTFI and its contribution to the overallperformance of the company is as under:

(Mio INR)
Particulars 2021-22 2020-21
Turnover 832 612
Profit/(Loss)before tax 21 16
PBT % on Turnover 2.5 2.6

Autozilla Solutions Private Limited (Autozilla)

During the financial year the Company has acquired a minority stake of26% in Autozilla Solutions Private Ltd. a Hyderabad based start-up offering B2Be-commerce solutions for manufacturers sellers and buyers of automobile spare parts aspart of an initiative to establish effective digital ecosystem around vehicle workshops.The financial performance of Autozilla and its contribution to the overall performance ofthe company is as under:

(Mio INR)
Particulars 2021-22 2020-21
Turnover 14 13
Profit/(Loss)before tax (12) 0
PBT % on Turnover -85.5 -2.7

12.3 Joint Venture Company

PreBo Automotive India Private Limited

Prebo Automotive Private Limited ("PreBo") is a Joint VentureCompany in which the Company holds 40% of the paid-up share capital. PreBo is in thebusiness of manufacturing/assembly and supply of mechanical and electromechanicalcomponents and assemblies for automobile and non-automobile industry.

The financial performance of PreBo and its contribution to the overallperformance of the company is as under:

TINR
Particulars FY 2021-22 FY 2020-21
Total Revenue 600531 274663
Profit/(Loss) before tax (31572) (18369)
Profit/(Loss) after tax (24771) (16394)

A separate statement containing the salient features of the financialstatement of the aforementioned Subsidiaries Associate and Joint Venture is enclosed asAnnexure ‘B' to this Report.

13. REMUNERATION POLICY

The Nomination and Remuneration Policy inter-alia provides forcriteria and qualifications for appointment of Director Key Managerial Personnel andSenior Management Board diversity remuneration to Directors Key Managerial Personneletc. The policy can be accessed at the following link: https://www.bosch.in/media/our_company/shareholder_information/2022/investor_service_ request_forms/nrcpolicyboschltd.pdf

14. PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration of employees and other detailsas required under Section 197(12) of the Act and rules framed thereunder is enclosed asAnnexure ‘C' to this Report.

The information in respect of employees of the Company requiredpursuant to Rule 5 of Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 as amended made available before the Annual General Meeting in electronicmode to any shareholder upon request sent at secretarial.corp@in.bosch.com.

15. RISK MANAGEMENT

The Company follows a specific well-defined risk management policywhich is integrated with its operations. The Policy has been developed after takingcognizance of the relevant statutory guidelines Bosch Guidelines on risk managementempirical evidences stakeholders' feedback forecast and expert judgment Company hasRisk Management Committee (RMC) consisting of Board Members to examine and review therisk inventory as well certify the risk mitigation plan. The RMC functions as perRegulation 21 of the SEBI Listing Regulations. Further to RMC the other subordinate riskmanagement teams comprising of Senior Executives of the Company addressing functionaloperational and strategic risk management in their corresponding area of responsibilitycovering overall risks in the area of commercial technical information technology andstatutory compliance.

The Committee inter-alia provides for the following:

a) In-built pro-active processes within the Risk Management Manual for reportingevaluating and resolving risks;

b) Identifying and assessing risks associated with various business decisions beforethey materialize. Take informed decisions at all levels of the organization in line withthe Company's risk appetite;

c) Ensuring protection of shareholders' stake by establishing an integrated RiskManagement Framework for identifying assessing mitigating monitoring evaluating andreporting all risks;

d) Strengthening Risk Management through constant learning and improvement;

e) Adoption and implementation of risk mitigation measures at every level in order toachieve long- term goals effectively and sustainably;

f) Regularly review Risk Tolerance levels of the Company as they may vary with changein the Company's strategy; and

g) Ensuring sustainable business growth with stability.

Further to this the Company has constituted a Corporate Risk Councilto support RMC with assessing the risk situation. This includes periodical reviewexchange of relevant information as well as the submission of statements and evaluation onrisk related subjects.

16. WHISTLE BLOWER POLICY/VIGIL MECHANISM

The Company has a Whistle Blower Policy which includes vigil mechanismfor dealing with instances of fraud and mismanagement.

Details of the Whistle Blower Policy have been mentioned in theCorporate Governance Report. The Whistle Blower Policy has also been uploaded on thewebsite of the Company and can be accessed at the following link:https://www.bosch.in/media/our_company/shareholder_information/2018/whistle_blower_policy-3.pdf.

17. RELATED PARTY TRANSACTIONS

Prior approval of the Audit Committee is obtained for all related partytransactions. The Audit Committee accords omnibus approval for Related Party Transactionswhich are in ordinary course of business foreseen repetitive in nature and satisfy thearm's length principles. The Audit Committee reviews on a quarterly basis thedetails of the Related Party Transactions entered pursuant to the aforementioned omnibusapproval.

Additionally the Company obtains a half yearly certificate from aChartered Accountant in Practice confirming that the related party transactions during thesaid period were in ordinary course of business repetitive in nature and satisfy thearm's length principles.

The details of Related Party Transactions under Section 188(1) of theAct required to be disclosed under Form AOC - 2 pursuant to Section 134(3) of the Act isenclosed as Annexure ‘D' to this Report.

The Company has framed a Policy for determining materiality of RelatedParty Transactions and dealing with Related Party Transactions. During the year underreview the Policy has been revised in line with regulatory amendments in SEBI ListingRegulations. The said Policy is hosted on the website of the Company and can be accessedat the following link: https://www.bosch.in/media/our_company/shareholder_information/2022/related_party_ transaction_policy_09022022.pdf.

18. ENERGY CONSERVATION TECHNOLOGY ABSORPTION FOREIGN EXCHANGEEARNINGS & OUTGO

The report in respect of conservation of energy technology absorptionforeign exchange earnings and outgo as required under Section 134 of the Act read withRule 8 of Companies (Accounts) Rules 2014 is enclosed as Annexure ‘E' to thisReport.

19. AUDITORS

19.1 Statutory Auditor

The shareholders at the 65th Annual General Meeting of theCompany held on September 01 2017 had appointed M/s. Deloitte Haskins & Sells LLP(Firm Registration No. 117366W/W-100018) as Statutory Auditors of the Company for a periodof 5 years until the conclusion of the 70th Annual General Meeting.

The Auditors' Report on the Standalone as well as ConsolidatedFinancial Statements for the Financial Year 2021-22 is unmodified i.e. it does not containany qualification reservation or adverse remark.

The Board of Directors has based on the recommendation of the AuditCommittee and subject to approval of the shareholders appointed Messrs. S. R. Batliboi& Associates LLP (member firm of Ernst & Young) (Firm Regn. no. 101049W/E300004)as Statutory Auditors of the Company for a term of five (5) years to hold office from theconclusion of the 70th AGM till the conclusion of the 75th AGM.

S.R. Batliboi & Associates LLP have given their consent to act asthe Auditors of the Company and have confirmed that their appointment if made will bewithin the limit specified under sections 139 and 141 of the Act. They have also confirmedthat they are not disqualified to be appointed as statutory auditors in terms of theprovisions of the Section 141 of the Act and the provisions of the Companies (Audit andAuditors) Rules 2014.

Accordingly resolution for the appointment of Messrs. S R Batliboi& Associates LLP will form part of the notice convening the 70th AGM.

19.2 Cost Audit & Cost Auditors

The Board of Directors on recommendation of the Audit Committeeappointed M/s. Rao Murthy & Associates Cost Accountants Bengaluru (RegistrationNo.000065) as Cost Auditors to audit the cost accounts of the Company for the FinancialYear 2022-23 in terms of the provisions of Section 148 of the Companies Act 2013.

The Audit Committee has also received a Certificate from the CostAuditors certifying their independence and arm's length relationship with theCompany.

In terms of the requirements of the said section the members arerequired to ratify remuneration payable to the Cost Auditors. Accordingly resolutionratifying the remuneration payable to M/s. Rao Murthy & Associates will form part ofthe Notice convening the 70th Annual General Meeting.

As per Section 148 (1) of the Companies Act 2013 the Company isrequired to maintain Cost Records. Accordingly Cost Records and Cost Accounts are dulymaintained by the Company.

19.3 Secretarial Auditor

Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany had appointed Mr. Pramod S.M Partner BMP and Co. LLP Company Secretaries forthe Financial Year 2021-22. The Report of the Secretarial Auditor is enclosed as Annexure‘F' to this Report. The Secretarial Auditors' Report does not contain anyqualification reservation or adverse remark or disclaimer.

19.4 Reporting of Fraud

During the year under review the Statutory Auditors Cost Auditors andSecretarial Auditor have not reported any instances of fraud committed in the Company byits Officers or Employees to the Audit Committee under Section 143 (12) of the Act.

20. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act 2013 the Board ofDirectors report that:

i. in the preparation of the annual accounts the applicable accountingstandards have been followed along with proper explanation relating to materialdepartures;

ii. they have selected and consistently applied accounting policies and have madejudgements and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and theprofit of the Company for that period;

iii. proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of the Act for safeguarding the assets of theCompany and for preventing and detecting fraud and other irregularities;

iv. the annual accounts have been prepared on a ‘going concern' basis;

v. proper internal financial controls are in place and that such controls are adequateand are operating effectively; and

vi. proper systems to ensure compliance with the provisions of all applicable laws werein place and that such systems were adequate and operating effectively.

21. DETAILS OF LOANS ADVANCES GUARANTEES OR INVESTMENTS

Particulars of loans given investment made or guarantee given orsecurity provided and the purpose for which the loan or guarantee or security is proposedto be utilized by the recipient of the loan or guarantee or security are provided in NoteNos. 6 and 7 to the Financial Statements. Further particulars of loans and advances inthe nature of loans to subsidiaries associates and firms/companies in which directors areinterested is given below:

(Mio INR)

Particulars Name of the Firm/ Company Amounts at the year end and the maximum amount of loans/ advances/ Investments outstanding during the year.
Loans and advances in the nature of loans to subsidiaries Robert Bosch India Manufacturing and Technology Private Limited 23
Loans and advances in the nature of loans to associates Nil Not Applicable
Loans and advances in the nature of loans to firms/companies in which directors are interested Nil Not Applicable

22. DEPOSITS

During the year under review there were no deposits accepted by theCompany as per the provisions of Companies Act 2013.

23. MATERIAL CHANGES AND COMMITMENTS

There were no material changes and commitments between the end of theyear under review and the date of this report affecting the financial position of theCompany.

24. EXTRACT OF ANNUAL RETURN

Pursuant to Section 92(3) read with Section 134(3)(a) of the Act theAnnual Return as on March 31 2022 is available on the Company's website athttps://www.bosch.in/media/our_ company/shareholder_information/2022/mgt7_31032022. pdf

25. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

The company has complied with provisions relating to the constitutionof Internal Complaints Committee under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013. The information as regards the numberof cases filed and their disposal under this Act is given in the Business ResponsibilityReport.

26. BUSINESS RESPONSIBILITY REPORT

In terms of the requirements of Regulation 34 (2) (f) of the ListingRegulations a report on Business Responsibility in the prescribed format forms a part ofthis Annual Report as Annexure – ‘G' to this Report .

27. CORPORATE GOVERNANCE

A report on Corporate Governance in terms of the requirements of theListing Regulations and a certificate from the Practicing Company Secretary forms part ofthis Annual Report as Annexure – ‘H' to this Report.

28. INSOLVENCY AND BANKRUPTCY CODE 2016 (31 OF 2016)

There was no application made or any proceeding pending under theInsolvency and Bankruptcy Code 2016 (31 of 2016) during the financial year.

29. SECRETARIAL STANDARDS

The applicable Secretarial Standards i.e. SS – 1 and SS – 2relating to "Meeting of the Board of Directors" and "GeneralMeetings" respectively have been duly complied by the Company.

30. GENERAL

Your Directors state that no disclosure or reporting is required inrespect of the following items as there were no transactions/events on these items duringthe year under review:

i. Issue of Equity Shares with differential rights as to Dividend voting or otherwise.

ii. Issue of Shares (including Sweat Equity Shares) to employees of the Company underany scheme.

iii. Significant or material orders passed by the Regulators or Courts or Tribunalswhich impact the going concern status and the Company's operations in future.

iv. Voting rights which are not directly exercised by the employees in respect ofShares for the subscription/ purchase of which loan was given by the Company (as there isno scheme pursuant to which such persons can beneficially hold shares as envisaged underSection 67 (3) (c) of the Act).

v. Difference between amount of valuation done at the time of one-time settlement andthe valuation done while taking loan from the Banks or Financial Institutions.

31. FOREIGN EXCHANGE MANAGEMENT (NON-DEBT INSTRUMENTS) RULES 2019

The Company has complied with Foreign Exchange Management (Non-DebtInstruments) Rules 2019 and certificate from the auditors certifying compliance of thesaid provisions has been obtained.

32. ACKNOWLEDGEMENTS

The Directors express their gratitude to the Government of India andState Governments of Karnataka Maharashtra Rajasthan and Tamil Nadu for their continuedcooperation extended to the Company. The Directors also thank all customers dealerssuppliers banks members and business partners for the excellent support received fromthem. The Directors would also like to acknowledge the exceptional contribution andcommitment of the employees of the Company during the year under review.

33. CAUTIONARY STATEMENT

Statements in the Board's Report and the Management Discussion& Analysis describing the Company's objective expectations or forecasts may beforward looking within the meaning of applicable laws and regulations. Actual results maydiffer materially from those expressed in the statement.

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