Moneycontrol
Feb 17, 2017 03:33 PM IST | Source: CNBC-TV18

Symphony survives note ban pain; more acquisitions on cards

Executive Director Nrupesh Shah expects Symphony to maintain a topline growth of 20-25 percent. The Ahmedabad-based air cooler company last week reported a 17.45 per cent jump in third quarter standalone net profit to Rs 56.06 crore.


Executive Director Nrupesh Shah expects Symphony to maintain a topline growth of 20-25 percent. The Ahmedabad-based air cooler company last week reported a 17.45 per cent jump in third quarter standalone net profit to Rs 56.06 crore.  


Symphony has launched five models of Mobicool that is mobile industrial air-coolers and also pure range of air-coolers. "Combination of these new products coupled with our successful horses should drive our revenue and performance," said Shah.


While the company did feel the heat of demonetisation it hopes to get back in the game with new models and acquisitions.

Shah said the company is open to international acquisition for market access. About a year ago the company acquired a Chinese company and is now in the process of integrating its operations.

Below is the verbatim transcript of Nrupesh Shah's interview to Latha Venkatesh, Sonia Shenoy and Anuj Singhal on CNBC-TV18.

Latha: What is your experience with demonetisation? Agreed, for you all it came during the winter month, not at a time when you sell anyway but is there any follow through impact now?

A: During the quarter, at a retail level, hardly any sales takes place but as per our business model, trade does buy with 100 percent advance and even though there was no compulsion for the trade to buy during the quarter, we grew by 11 percent in respect of topline on year-on-year and bottomline while there has been a growth of 18 percent. But it was also coupled with strong growth in international business.

As far as demonetisation is concerned and its impact, up till October, there was a very robust growth, the month of November was almost a wash out while in the month of December, business was almost back to normal. There was a decent growth.

However, starting January, we are again registering very strong growth and we expect that in the industry like u factor of demonetisation coupled with goods and services tax (GST) down the line should substantially help us.

Anuj: What is remarkable about your numbers is the way you have maintained your strong margins in air-cooler segment and also your overall gross margins. Do you think that is something that you will be able to sustain?

A: We feel that we should be in a position to maintain the gross margin as well as profit before tax (PBT) and profit after tax (PAT) margin year as a whole on account of couple of reasons. Very strong innovative products further innovation in the pipeline and ultimately in our segment, Symphony is a thought leader, distribution leader, product leader, innovation leader and hence a brand leader.

Latha: Should we hear of any acquisitions from you?

A: We are open to international acquisition for market access. About a year before we acquired a Chinese company and we are integrating their operations. So especially in overseas market, that too in our line of activity that is centralised air-cooling or residential air-cooling -- if we get such a right opportunity at a right valuation, we are open to that and we come across various such opportunities but nothing at the advanced stage as of now.

Latha: You are not looking at domestic brands?

A: We may not be much interested in domestic acquisitions because we ourselves have a very strong product portfolio as well as distribution network but depending upon the situation and circumstances, we may consider.

Latha: What situations will make you consider an acquisition, is it price or is it product, it is geography?

A: It is very difficult to preamp because for acquisitions, several factors have to be considered. So very difficult but as far as international acquisitions are concerned, we are much more open, much more keen and that is where we feel we have barely scratched the surface and there is a huge potential to grow.

Latha: What do you think you will finish the year with in terms of revenues and therefore what does FY18 look like?

A: Overall we maintain our topline growth of about 20-25 percentage and also bottomline growth in line with that in the medium-term. On top of it, in the recent past, we have launched Mobicool that is mobile industrial air-coolers about five models, and just before that pure range of air-coolers and we are further going to test market, wall mounted air-cooler for which we have applied for global patent and we feel that combination of these new products coupled with our further successful horses should drive our revenue and performance.

Nrupesh Shah
Nrupesh Shah
ED-Corporate Affairs|Symphony
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