Forbes India – August 4, 2017

By Samar SrivaStava

U

nlike most

entrepreneurs in the

white goods segment,

Achal Bakeri, 57, has

not built factories

with rows upon rows

of assembly lines. Nor does his venture

Symphony Ltd have a finger in every

pie of the sector. A single-product

company, it devotes all its resources to

what it does best—making air coolers.

Symphony develops its products

in-house and provides the tools for

manufacturing, but outsources the

final assembly to third party plants.

Its employees look after vendor

management and quality control.

It is this asset-light—and

consequently capital-light—model that

has made the stock a favourite among

investors. Shares of Symphony, which

could be picked up for a little over

`100 five years ago, were trading at

`1,364 on BSE on July 11, 2017—that’s

a compounded annual growth rate

of around 62 percent in the period.

More importantly, Symphony

has chosen to return cash to its

shareholders. Its return on net

worth has always been above 30

percent in each of the last five

years. “Returning excess capital to

shareholders is the hallmark of a

good business and shows that the

interests of the promoters are aligned

with those of minority shareholders,”

says Utpal Sheth of wealth

management firm Trust Capital.

Devoid of major heavy assets,

Symphony has been modelled as

a “product innovation, marketing

and distribution company”,

says Bakeri, founder chairman

and managing director.

The result has been a clear pole

position in the domestic air cooler

market and financials that are in

the pink of health. Revenues in

FY17 grew to `768 crore, clocking a

compounded annual growth rate of

16 percent over the last five years.

Profits, too, have kept pace, expanding

Beating the Heat

38 | forbes india August 4, 2017

Missteps in diversification once pushed

air cooler Maker Symphony to bankruptcy.

Wiser froM the ordeal, founder

a chal bakeri is noW taking the coMpany

global through acquisitions

Achal Bakeri, founder,

chairman and managing

director of Symphony, had

sold out all the units that

he had manufactured in

the first year of production