Symphony Corporate Ppt
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Transcript of Symphony Corporate Ppt
Symphony LimitedUSA INDIA MEXICO
1
World leader in Air Cooling
Residential Range
2
Industrial & Commercial Range
3
Index
• Principle of Air Cooling
• Background
• Business Model
• Financials
• Opportunities
– Domestic Residential
– Domestic Modern Retail
– Domestic Industrial
– International
4
Index
• IMPCO – Mexican WOS
• SWOT Analysis
• Quality Standards and Certifications
5
Pour WaterSwitch On
Hot
Air
Cool
Air
Principle of Air Cooling
6
Principle of Air Cooling
Water
Distributor
HOT DRY
AIR Evaporative
Media
Water Reservoir
Fan
COOL
FILTERED
AIR
7
PARAMETERS AIR COOLER AC
CAPITAL COST LOW HIGH
RECURRING COST 90% LOWER THAN AC VERY HIGH
INDOOR AIR QUALITY100% FRESH FILTERED
COOL AIR
STALE DRY AIR
RECIRCULATED
REFRIGERANTS WATERPOLLUTING
REFRIGERANTS
MAINTENANCESIMPLE AND COST
EFFECTIVE
COMPLEX AND
EXPENSIVE
PORTABILITY YES NO
USAGE OUTDOOR & INDOOR INDOOR ONLY
EMISSION ECO-FRIENDLYENVIRONMENTALLY
HARMFUL CFC
HUMID CLIMATE LESS EFECTIVE EFFECTIVE
Air Cooler V/s. Air Conditioner
8
The Symphony Advantage
9
Operating Cost of 1 or 2 bulbs only
Also works on Inverter and portable gensets
Delivers fresh, filtered cool air
For Indoor and Outdoor usage
Background
• Established in 1988
• Went Public in 1994
• Pre-2000, positioning was : „Many products – One
market‟
• Ventured into AC‟s, Washing machines and other
durables
• Suffered financial stress and restructured
• Revived with focus on core-competence (Air Coolers)
• Post 2005, positioning is – „ One Product – Many
Markets‟ with complete range of Residential and
Industrial Air Cooling Solutions
10
Business Model: Key Highlights
• Design driven– Design leader, Advantage over competition
• Brand focused– World‟s and India‟s leading Air-cooler brand
• Global Distribution network– 60+ countries, India – 16,400+ retail dealers
• Asset light• Defining market terms
– Sales only on cash
– Sales to Subsidiary and Modern Retail on credit
• Capital Light– Negative Net-working Capital
• High ROI business model– Asset and capital – light model leading to high ROI
11
Business Model: Undisputed Leadership
• World‟s largest selling Air-Cooler Brand
• Leader in India by Miles
– Market share almost 50% amongst organised market
players, despite new entrants
• Competitors – many leading Indian brands
• No major Global player
• GST - Potential game changer
– will accelerate conversion of unorganised market to
organised players
12
Business Model: Key Entry Barriers/Moat
• USP :
– Innovation, Design, Quality, Features and Performance
• Brand and category leadership
• Distribution leadership
• Customer centric
• Management:
– Experience (what to do and what not to do)
– Ahead of curve attitude (new products, new designs)
• Focused approach
13
Business Model: Management Beliefs
• Focus: Stick to Core-Competence. No distractions
• Value acquisitions
• Business Model:
– Asset light and Capital Light
– Variable cost business model
– Negligible sales on credit
– Profitable Growth
• Create value for all stakeholders
• ROI – most important determining factor
14
2007 2008 2009 2010 2011 2012 2013
Volume growth
2007 2008 2009 2010 2011 2012 2013
Gross Revenue growth
5.3
18.9
31.2
28.4
24.022.9 23.1
2007 2008 2009 2010 2011 2012 2013
PBT % on Gross Revenue
15
Financials: P&L
CAGR from 2007. 2011 onwards, consolidated with IMPCO
2007 2008 2009 2010 2011 2012 2013
PAT growth
8.0 7.8
0.0 0.0 0.0 0.0 0.00.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
2007 2008 2009 2010 2011 2012 2013
Debt (Rs.Crs.)
Financials: Balance Sheet and EPS
16
EPS (Excluding Extra Ordinary Items) (In Rs.)Book Value (In Rs.)EPS (Excluding Extra Ordinary Items) (In Rs.)Book Value (In Rs.)
7.0 7.0 7.0 7.0 7.0 7.0 7.0
0.0
2.0
4.0
6.0
8.0
2007 2008 2009 2010 2011 2012 2013
Equity (Rs. Crs)<------------------No Equity Dilution -------------------------->
0.6
4.2
8.2
10.6
14.6 15.2
17.2
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
18.0
20.0
2007 2008 2009 2010 2011 2012 2013
EPS (Face value of one share Rs. 2) (In Rs.)
(1.0)2.4
14.8
24.8
43.6
54.1
63.5
(10.0)
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
2007 2008 2009 2010 2011 2012 2013
Book Value (In Rs.)
2011 onwards, consolidated with IMPCO
Financials: Capex and Dividend
17
Dividend Payout Ratio (In %)Dividend Payout Ratio (In %)
1.3 1.1 1.5
7.8
24.4
4.7 5.6
0.0
5.0
10.0
15.0
20.0
25.0
30.0
2007 2008 2009 2010 2011 2012 2013
Capex (Rs. Crs.)
0.0 0.0 1.9 5.5 15.9
42.1 44.3
0 010 25
100
275
325
0.0
50.0
100.0
150.0
200.0
250.0
300.0
350.0
2007 2008 2009 2010 2011 2012 2013
Dividend Payout Ratio & Dividend %
Dividend payout ratio
Dividend %
2011 onwards, consolidated with IMPCO
Domestic Opportunity: Key Growth Drivers
• Rising per capita income
• Improved life-style and aspirations
• Global Warming
• Acceptance as a utility product rather than a luxury
• Electrification
• Availability of Easy Finance Options
• Organized retail is growing exponentially. We‟ve also registered
300%+ growth in last 2 years
• Strong and trusted 25 year old brand
18
Domestic Opportunities: Strong Brand
• Symphony Brand is synonymous with air cooler
• Highest Ad-spend in the air cooler category
• Advertising since 1990 through:
– TV
– Radio
– Below the Line
– Internet (since 2010)
19
Opportunities: Modern Retail in India
20
Modern Retail Customers in India
21
Sales Growth: Modern Retail
22
175%
314%
2010-11 2011-12 2012-13
Growth %
Modern Retail Display
23
Opportunities: Industrial Cooler
“90% of American firms named cool air as the
single biggest boost to their productivity”
“Cooling raised productivity by a quarter. On
factory floors it cut absenteeism and stoppages.”
(Source: The Economist, Page 41 Jan 2013 issue)
24
Opportunities: Industrial Cooler
25
EffectiveTemp (C )
24 27 29 32 35 38 41
Loss of work output
3% 8% 18% 29% 45% 62% 79%
Loss of accuracy
0% 5% 40% 300% 700% > 700%
(Source: Study for NASA. “Comfort Conditioning the Plant with Evaporative
Cooling” Plant Engineering July 8, 1976 Pg 76 Joseph Marg
Opportunities: Industrial Cooler
• Central AC Market in India - Rs 40,000 Mn
• Central Air Cooling Market size is undefined
• Potential market size > Rs 40,000 Mn
• Symphony is the only branded player
• Most industrial, commercial and religious
establishments are potential customers
26
Industrial Cooler: Potential Sites
27
Offices UniversitiesResidences Lecture hallsShops Service stationsShowrooms Poultry farmsPlaces of worship Dairy FarmsClub Houses Departmental storesWarehouses DG roomLounges LaundryCanteens KitchenMalls Panel roomsGuest Houses FactoryBanquet Halls Industry
Successful Installations
28
29
World‟s Largest Air Cooling ProjectExecuted by IMPCO, Mexico
Air-cooled entire Mecca Complex in Saudi
100 Million CFM of air cooling done.
30
India‟s Largest Air Cooling ProjectExecuted by Symphony, India
Baba Ramdev’s Yoga Hall, Haridwar
Ductless cooling of 2,00,000 sq. ft hall with just 22 units.
31
Industrial & Commercial Coolers: Installations
DHL warehouse, Delhi
KJR Polyfilms, Hyderabad ISB, New Delhi
32
Industrial & Commercial Coolers: Installations
Marico Industries - Jalgaon Railway Waiting Room - Kota
Sweet Shop - Indore Marriage Hall - Latur
33
Industrial Coolers: Global Installations
34
Industrial Coolers: Global Installations
35
Industrial Coolers: Global Installations
Opportunities: International Markets
36
• Air cooler seen as a Green Product – gaining popularity
• Global warming accelerating demand
• Current market size for ACs : 75 mn units
• AC global market size expected to be 150 mn by 2017
(industry report)
• Air Cooler market potential should logically be greater
International Markets: Presence
37
Office/Country Manager
Symphony across geographies
38
South Africa Middle East
America South East Asia
Symphony across geographies
39
Asia
CIS Countries Europe
Africa
IMPCO
IMPCO
1930Adam Goettl
invents and patents first Evaporative
Cooler
1939International Metal
Products Co. (IMPCO) founded in Phoenix, USA
1960First cooler
made in Mexico
2009-11Symphony
Acquires Impco.
1955IMPCO Mexico
2006All products are made in Mexico
IMPCO
IMPCO plant in Monterrey, MX (150 miles from US border)US office in Phoenix.
MONTERREY
IMPCO
• Symphony started leveraging Impco‟s relationships
With large format stores like
• Acquisition has opened substantial opportunities to offer end-to-end
economical and environment-friendly air-cooling solutions
• Commercial and Industrial Coolers available to distribute in India and
through its international distribution.
• Initiated Brand Building through TV ad campaign for
43
SWOT Analysis
44
Strengths
• Focused on one category
• Innovation led
• Strong brand
• Asset-light business model
• No debt
• Low competition, globally
Weakness
• Relatively small size of the current market
• Seasonality in IMPCO
Opportunity
• Vast Untapped market potential for residential coolers
• Global Warming
• Huge potential for Industrial coolers
•
products
• Inorganic growth
Threat
• Competition from China
Quality Standards and Certifications
45
First Indian company to receive
certification for Germany
Mexico
GlobalRussia-CISSaudi Arabica
North America Europe Brazil
Malaysia Kuwait
Quality Standards and Certifications
46
Star Export House
Govt. of India approved R&D centre
ICAI AWARD IN 2nd CONSECUTIVE YEAR FOR
„EXCELLENCE IN FINANCIAL REPORTING‟
47
The Award was handed over
by Mr. V. N. Kaul, the former
Comptroller and Auditor
General of India, (who was also
the chief of the jury) to Mr.
Nrupesh Shah, Executive
Director and to Mr. Bhadresh
Mehta, VP-Finance
ICAI has nominated
Symphony Annual Report for
„Best Presented Accounts Award‟
for 2012 organized by South
Asian Federation of Accountants
(SAFA)
48
www.symphonylimited.com
Symphony USA Inc.