Symphony Limited

USA INDIA MEXICO

World leader in Air Cooling

Residential Range

Industrial & Commercial Range

Index
Principle of Air Cooling Background Business Model Financials

Opportunities
Domestic Residential Domestic Modern Retail Domestic Industrial International

Index
IMPCO Mexican WOS

SWOT Analysis
Quality Standards and Certifications

Principle of Air Cooling

Hot Air

Cool Air Pour Water

Switch On

Principle of Air Cooling

Water Distributor COOL FILTERED AIR

HOT DRY AIR

Evaporative Media

Fan

Water Reservoir

Air Cooler V/s. Air Conditioner

PARAMETERS CAPITAL COST AIR COOLER LOW AC HIGH

RECURRING COST
INDOOR AIR QUALITY REFRIGERANTS

90% LOWER THAN AC

100% FRESH FILTERED COOL AIR WATER SIMPLE AND COST EFFECTIVE

VERY HIGH
STALE DRY AIR RECIRCULATED POLLUTING REFRIGERANTS COMPLEX AND EXPENSIVE

MAINTENANCE PORTABILITY
USAGE EMISSION HUMID CLIMATE

YES
OUTDOOR & INDOOR ECO-FRIENDLY LESS EFECTIVE

NO
INDOOR ONLY ENVIRONMENTALLY HARMFUL CFC EFFECTIVE

The Symphony Advantage

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 ACs, 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

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Business Model: Key Highlights

Design driven Brand focused
Design leader, Advantage over competition

Global Distribution network Asset light Defining market terms Capital Light

Worlds and Indias leading Air-cooler brand 60+ countries, India 16,400+ retail dealers

Sales only on cash Sales to Subsidiary and Modern Retail on credit

Negative Net-working Capital

High ROI business model

Asset and capital light model leading to high ROI

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Business Model: Undisputed Leadership

Worlds 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

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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

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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

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Financials: P&L
Gross Revenue growth Volume growth

2007

2008

2009

2010

2011

2012

2013

2007

2008

2009

2010

2011

2012

2013

PBT % on Gross Revenue

31.2 28.4 24.0 18.9 22.9 23.1

PAT growth

5.3

2007

2008

2009

2010

2011

2012

2013

2007

2008

2009

2010

2011

2012

2013

CAGR from 2007. 2011 onwards, consolidated with IMPCO

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EPS Book (Excluding Value (In Extra Rs.) Ordinary Items) (In Rs.)

Financials: Balance Sheet and EPS

8.0 6.0 4.0 2.0 0.0 2007 20.0 2008 2009 2010 2011 2012 2013

Equity (Rs. Crs) <------------------No Equity Dilution -------------------------->

7.0 7.0 7.0 7.0 7.0 7.0 7.0

Debt (Rs.Crs.)
9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 8.0 7.8

0.0 2007 2008 2009

0.0 2010

0.0 2011

0.0 2012

0.0 2013

EPS (Face value of one share Rs. 2) (In Rs.)

17.2 14.6 15.2 70.0 60.0 10.6 8.2 50.0 40.0 30.0 4.2 0.6 20.0 10.0 2008 2009 2010 2011 2012 2013 0.0

18.0
16.0 14.0 12.0 10.0

Book Value (In Rs.)

63.5 54.1

43.6

8.0
6.0 4.0 2.0 0.0 2007

24.8 14.8 2.4 2008 2009 2010 2011 2012 2013

(1.0) 2007

(10.0)

2011 onwards, consolidated with IMPCO

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Dividend Payout Ratio (In %)

Financials: Capex and Dividend

Capex (Rs. Crs.)

30.0 25.0 20.0 24.4 350.0 300.0 250.0

Dividend Payout Ratio & Dividend %

Dividend payout ratio Dividend % 275

325

200.0
150.0 7.8 4.7 1.3 2007 1.1 2008 1.5 2009 2010 2011 2012 2013 100 10 1.9 2009 25 42.1 15.9 2011 2012 2013 44.3

15.0
10.0 5.0 0.0

5.6

100.0 50.0 0.0 0.0

0 0.0 2008

5.5

2007

2010

2011 onwards, consolidated with IMPCO

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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. Weve also registered 300%+ growth in last 2 years Strong and trusted 25 year old brand

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Domestic Opportunities: Strong Brand

Symphony Brand is synonymous with air cooler Highest Ad-spend in the air cooler category Advertising since 1990 through:
TV Print Radio Below the Line Internet (since 2010)

19

Opportunities: Modern Retail in India

20

Modern Retail Customers in India

21

Sales Growth: Modern Retail

Growth %

314% 175%

2010-11

2011-12

2012-13
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Modern Retail Display

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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)

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Opportunities: Industrial Cooler

Effective Temp (C )
Loss of work output Loss of accuracy

24
3% 0%

27
8% 5%

29
18% 40%

32
29% 300%

35
45% 700%

38
62%

41
79%

> 700%

(Source: Study for NASA. Comfort Conditioning the Plant with Evaporative Cooling Plant Engineering July 8, 1976 Pg 76 Joseph Marg

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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

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Industrial Cooler: Potential Sites

Offices Residences Shops Showrooms Places of worship Club Houses Warehouses Lounges Canteens Malls Guest Houses Banquet Halls Universities Lecture halls Service stations Poultry farms Dairy Farms Departmental stores DG room Laundry Kitchen Panel rooms Factory Industry
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Successful Installations

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Worlds Largest Air Cooling Project

Executed by IMPCO, Mexico
Air-cooled entire Mecca Complex in Saudi

100 Million CFM of air cooling done.

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Indias Largest Air Cooling Project

Executed by Symphony, India
Baba Ramdevs Yoga Hall, Haridwar

Ductless cooling of 2,00,000 sq. ft hall with just 22 units.

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Industrial & Commercial Coolers: Installations

DHL warehouse, Delhi

KJR Polyfilms, Hyderabad

ISB, New Delhi

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Industrial & Commercial Coolers: Installations

Marico Industries - Jalgaon

Railway Waiting Room - Kota

Marriage Hall - Latur

Sweet Shop - Indore

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Industrial Coolers: Global Installations

33

Industrial Coolers: Global Installations

34

Industrial Coolers: Global Installations

35

Opportunities: International Markets

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

36

International Markets: Presence

Office/Country Manager

37

Symphony across geographies

South Africa

Middle East

America

South East Asia

38

Symphony across geographies

Africa

Asia

CIS Countries

Europe

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IMPCO

IMPCO
1930 Adam Goettl invents and patents first Evaporative Cooler 1939 International Metal Products Co. (IMPCO) founded in Phoenix, USA

2006 All products are made in Mexico

1960 First cooler made in Mexico

1955 IMPCO Mexico

2009-11 Symphony Acquires Impco.

IMPCO

MONTERREY

US office in Phoenix.

IMPCO plant in Monterrey, MX (150 miles from US border)

IMPCO
Symphony started leveraging Impcos 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

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SWOT Analysis
Strengths Focused on one category Innovation led Strong brand Asset-light business model No debt Low competition, globally Opportunity Vast Untapped market potential for residential coolers Global Warming Huge potential for Industrial coolers products Inorganic growth Threat Competition from China

Weakness Relatively small size of the current market Seasonality in IMPCO

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Quality Standards and Certifications

First Indian company to receive certification for Germany

North America

Europe

Brazil

Mexico

Saudi Arabica

Russia-CIS

Malaysia

Global

Kuwait

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Quality Standards and Certifications

Star Export House

Govt. of India approved R&D centre

46

ICAI AWARD IN 2nd CONSECUTIVE YEAR FOR EXCELLENCE IN FINANCIAL REPORTING

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)
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www.symphonylimited.com

Symphony USA Inc.

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