Bosch shares in focus after UBS calls ₹9,068 crore deal 'value accretive'

Shares of Bosch Ltd., which closed over 7% higher on Wednesday, will be in focus on Thursday, April 9, after the company announced plans to acquire a 100% stake in Bosch Chassis Systems India, confirming a CNBC-TV18 newsbreak. The stock has risen 25% this month.

The acquisition will be carried out from existing shareholders, Robert Bosch Investment Nederland BV and Robert Bosch LLC, through a share purchase agreement involving Bosch Ltd. and the promoter group entities.

The transaction is valued at up to ₹9,068.68 crore and will be executed through a combination of preferential allotment of equity shares and a cash component. The deal will be completed by July 7, 2026.

Post acquisition, Bosch Chassis Systems India will continue to operate as an independent entity, with its governance overseen by Bosch Ltd.

Separately, Bosch Ltd has approved the issuance of 1,230 equity shares with a face value of ₹10 each at a price of ₹35,200 per share, including a premium of ₹35,190. These shares will be issued on a preferential basis for consideration other than cash to promoter group entities.

UBS maintains 'Sell' on Bosch

Brokerage firm UBS has a 'Sell' rating on Bosch, with a price target of ₹27,920.

The brokerage said the acquisition is likely to be value accretive from both an earnings per share and return ratio standpoint, supported by limited equity dilution and meaningful cash deployment.

It added that the implied FY25 enterprise value (EV) to earnings before interest, tax, depreciation and amortisation (Ebitda) multiple of 10.6x for the transaction is significantly lower than Endurance Technologies' FY25 multiple of 21x, as well as its one year forward multiple of 14x.

The acquisition is aimed at strengthening Bosch Ltd.'s capabilities in key areas such as safety and braking, while complementing its existing presence in power solutions.

Bosch Chassis Systems India represents the Vehicle Motion division of the Bosch Group in India and is a market leader in automotive safety systems.

Its portfolio includes active safety systems such as anti lock braking systems and electronic stability control, passive safety systems including airbag control units and sensors, as well as actuation braking systems across passenger vehicles, two wheelers, and commercial vehicles.

Guruprasad Mudlapur, President of the Bosch Group in India and Managing Director of Bosch Ltd., said the acquisition reflects the company's focus on strengthening its growth trajectory through portfolio diversification and enhancing its leadership in mobility solutions through local research and manufacturing.

Sandeep Nelamangala, Joint Managing Director of Bosch Ltd., said the transaction will help the company transition from supplying individual components to delivering integrated, future ready platform solutions, in line with evolving mobility trends in India.