Benchmarking is the practice of comparing business processes and performance metrics to

industry bests and best practices from other companies. For Auto Ancillary sector we have
taken BOSCH Ltd. As our Benchmark Company. BOSCH Ltd. is a German multinational
engineering and technology company headquartered in Gerlingen, near Stuttgart, Germany.
Bosch's core operating areas are spread across four business sectors; mobility (hardware and
software), consumer goods (including household appliances and power tools), industrial
technology (including drive and control) and energy and building technology.
We have taken BOSCH Ltd as our Benchmark due to following reason:
1. High Market Capitalization – Market capitalization is equal to the share
price multiplied by the number of shares outstanding. BOSCH Ltd has high market
capitalization as compare to other competitor available in auto ancillary sector.
BOSCH reported market capitalization of Rs. 42406 crore. Using market capitalization
to show the size of a company is important because company size is a basic determinant
of various characteristics in which investors are interested, including risk.
2. High Earning per Share Ratio - Earnings per share (EPS) is calculated as a company's
profit divided by the outstanding shares of its common stock. The resulting number
serves as an indicator of a company's profitability. he higher a company's EPS, the more
profitable it is considered.
EPS of BOSCH is very high i.e. Rs 525 which is very high as compared to its
competitor.
3. High Sales turnover – BOSCH has the highest sales turnover in the ancillary sector as
compare to its competitor. So we can say that BOSCH is a market leader in Auto
Ancillary Sector. High Sales Turnover give high net profit to the company as they also
generated highest Net profit of Rs 1598 crore in the financial year of mar’19.
4. Constant Growth in Revenue Generated – BOSCH show a growth of 7.56% in Sale
turnover from mar’16 to mar’17 and also there is growth of 12% in sales turnover from
mar’17 to mar’18.
5. Zero Debt Ratio – The debt ratio for a given company reveals whether or not it has
loans and, if so, how its credit financing compares to its assets. It is calculated by
dividing total liabilities by total assets, with higher debt ratios indicating higher degrees
of debt financing.
Debt ratios can be used to describe the financial health of individuals, businesses, or
governments. Investors and lenders calculate the debt ratio for a company from its
major financial statements, as they do with other accounting ratios.
 Whether or not a debt ratio is "good" depends on the context: the company's
industrial sector, the prevailing interest rate, etc.
 In general, many investors look for a company to have a debt ratio between 0.3
and 0.6.
 From a pure risk perspective, debt ratios of 0.4 or lower are considered better,
while a debt ratio of 0.6 or higher makes it more difficult to borrow money.

BOSCH has zero debt ratio which is good for company as they are not associated with
any risk and are financial capable of investing money on their own to company growth.