🧠 At a Glance
Symphony Ltd, once the undisputed king of air coolers, still flexes a 33% ROE and 37% ROCE. But over the last 5 years, topline growth has felt like a desert breeze—hot in spurts, mostly dry. With 27M+ coolers sold globally and 55+ patents, the IP is strong—but is investor patience cooling off?
🏭 1. Business Model: It’s Always Cooler Inside
- 🧊 Product: Residential, commercial, and industrial evaporative air coolers
- 🌍 Global Play: India, Mexico (IMPCO), China (MKE), Australia (Climate Technologies)
- 📦 Channel: Mix of B2C retail, B2B commercial installations, and exports
- 🏛️ IP Arsenal:
- 97+ designs
- 417+ trademarks
- 55+ patents (22 filed in FY24 alone)
It’s like the Dyson of desi cooling, minus the price tag and with a stock price chill.
📉 2. Financial Recap (FY21–FY25)
| ₹ in Crores | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue | 900 | 1,039 | 1,188 | 1,156 | 1,576 |
| Net Profit | 107 | 121 | 116 | 148 | 213 |
| ROCE (%) | 16% | 17% | 15% | 19% | 37% |
| ROE (%) | 15% | 17% | 16% | 21% | 33% |
| OPM (%) | 16% | 16% | 12% | 15% | 20% |
| EPS (₹) | 15.34 | 17.2 | 16.64 | 21.48 | 30.89 |
| Dividend Payout % | 33% | 52% | 30% | 61% | 43% |
🔥 Highlights:
- Profit more than doubled from FY21 to FY25
- FY25 margins returned to 20%+, best in a decade
- ROCE has spiked to 37%, showing return of operating leverage
- Cash flow from operations? ₹259 Cr in FY25—record high
🐢 3. What’s Not So Cool?
Despite great profit growth, sales CAGR over 5 years is just 7%.
Why?
- ❌ Coolers are seasonal
- ❌ High base in past years (2018–19 boom)
- ❌ Low pricing power vs ACs
- ❌ Overseas subsidiaries (especially China) underperformed until recently
- ❌ Domestic market hit by intense summer AC adoption and unorganized players
🧾 4. Cash Flow, Capex & Balance Sheet
- 🧮 Operating cash flow: ₹259 Cr in FY25
- 🏦 Debt: Minimal (₹142 Cr)
- 🏗️ Capex: Modest — Fixed assets have stayed around ₹320–350 Cr for 3 years
- 💸 Investments: ₹440 Cr parked – could be used for buybacks, M&A, or dividends
- 💰 Net cash balance remains strong
🟢 Bottom Line: The company is an FCF machine. It doesn’t need to grow 20% to be valuable.
🔍 5. Peer Check
| Company | P/E | ROCE | OPM | Growth (TTM) |
|---|---|---|---|---|
| Voltas | 51x | 18% | 10% | 13% |
| Blue Star | 57x | 26% | 11% | 20% |
| Whirlpool | 49x | 13% | 12% | 15% |
| Symphony | 31x | 37% | 20% | 36% |
🎯 Symphony has:
- 🔼 Highest margins
- 🔼 Best ROCE
- 🔽 Lowest P/E
So… why is it lagging in market cap? Maybe because air coolers aren’t sexy, or investors are obsessed with ACs, not eco-coolers.
📈 6. Fair Value Estimate (FV Range)
Let’s assume:
- FY26 PAT: ₹230–240 Cr
- Sectoral P/E fair zone = 30x to 38x (Blue Star/Voltas/Whirlpool average)
➡️ Fair Value = ₹6,900 Cr to ₹9,100 Cr
Current Market Cap = ₹7,560 Cr
So:
✅ Reasonably valued
🚀 Can re-rate if sales growth crosses 15%
⚠️ Don’t expect wild moves unless AC competitors stumble
🧠 7. TL;DR – Should You Keep Symphony in Your Portfolio?
- Symphony is the king of coolers, but market sees it as boring
- After years of mid growth, FY25 brought a profit breakout
- Margin expansion + global ops reboot = tailwinds
- Valuation is not expensive — but growth needs to sustain
- Could be a dividend-paying, high-ROCE compounder — not a momentum rocket
Tags:
Symphony Ltd stock analysis, Symphony 5 year review, cooler stocks India, Voltas vs Symphony, consumer durable multibaggers, high ROCE stocks, air cooler industry, EduInvesting India
✍️ Written by Prashant | 📅 18 June 2025
