Bosch invests in online marketplace for auto spares
The India unit of engineering and technology company Bosch has picked up a 26 percent stake in Autozilla Solutions, a startup in Hyderabad that operates a B2B e-commerce marketplace for buying and selling auto parts, for Rs 13.35 crore.
"This is part of an initiative to establish effective digital ecosystem around vehicle workshops," Bosch said, in a stock-exchange filing on Tuesday.
“This transaction will enable Bosch's automotive aftermarket division to strengthen the market pull through its "Extra" Loyalty Program for independent car workshops and Bosch Car Service outlets,” Bosch said in the exchange filing.
Bosch Car Service is present in around 250 outlets across India. The company expects to complete the deal that values Autozilla Solutions at Rs 51.4 crore by March 2022.
Autozilla develops e-commerce solutions, and connects manufacturers and sellers to simplify the process of auto-part discovery and purchase. It was founded by Vijay Gummadi in April 2015.
As the nuts and bolts of cars and two-wheelers get increasingly complex, Autozilla aims to solve the problem of buyers to get spare parts.
The startup reported turnover of Rs 1.28 crore in financial year (FY) 2021, up 191 percent from the previous year. The company’s net worth was Rs 1.52 crore, as of March 31, 2021.
Sellers can expand sales to a national network through Autozilla, while buyers can find auto parts they are looking for, according to Autozilla's LinkedIn profile.
Automotive products account for 86 percent of Bosch's revenue of Rs 9,716.23 crore. Its automotive aftermarket segment was impacted severely due to reduced vehicle mobility in FY 2021.
In the quarter ended September 30, 2021, Bosch reported consolidated income of Rs 2,918 crore, up 17.7 percent over a low base in the same quarter last year.
“Although the automotive market production in India has declined also due to the ongoing semiconductor shortage, there are first signs of recovery,” said Soumitra Bhattacharya, President, Bosch Group - India, said in a press statement.
"However, uncertainty in the market remains a major concern for the automotive industry going forward,” he added.
Bosch said it is undergoing "major transformation with regard to structural and cyclical changes in the automotive market, and emerging opportunities in the electro mobility and mobility segment.”
“The company is already on the way to transitioning into an enterprise with a digital ecosystem while remaining true to our core of manufacturing and operational excellence,” Bosch said in the statement.
It has spent Rs 743 crore in FY 2021 for these restructuring and transformational costs.
Bosch has adopted digitalisation across its service solutions. It has forayed into e-commerce space with partners such as Amazon and Flipkart, as well as the government e-Market portal, a dedicated online market for goods and services procured by government organisations and public sector units.