For 4QCY2008, BOSCH clocked 13.5% decline in net sales to Rs974.4 crore, which was marginally below our expectation of Rs994 crore.
On the operating margin front, the company witnessed 270bp y-o-y decline in margins owing to higher raw material costs, which increased by 292bp y-o-y and accounted for over 47.4% of net sales (44.5% in 4QFY2007).
Staff cost for the quarter also increased by 135bp y-o-y while other expenditure reduced by 158bp. In absolute terms EBITDA declined by 27.2% to Rs175.4 crore (Rs240.9 crore).
PAT declined by 24.3% y-o-y to Rs94.2 crore (Rs124.4 crore). This was mainly supported by an increase of 72.8% y-o-y in interest income to Rs35.3 crore. Depreciation for the quarter increased by 9.3% to Rs105.3 crore.
We maintain Buy on the stock with a target price of Rs3,658.