If you invested Rs 1,00,000 in Symphony in the year 2003, your principal amount with interest today would stand at Rs 3.7 crore.
Established in 1988, this Ahmedabad-based air cooling company's stock has delivered an unmatched returns in the past 10 or even 16 years. Those who invested in the mid-cap company has gained handsomely. Had you invested Rs 1,00,000 in Symphony in 2003, this amount would have turned Rs 3.7 crore today.
Even if you had invested Rs 1,00,000 in 2009, this amount would have turned Rs 7,51,000 today, an increase of 650 percent.
The stock is not only an outperformer in this particular industry, but also in several other sectors in terms of the share price rally. Its peers, Blue Star and Voltas have given 460 percent and 422 percent returns, respectively, since 2003.
Symphony’s sales rose 31.76 year-on-year (YoY) to Rs 195 crore in the July-September quarter this financial year. The net profit during the same quarter jumped 68 percent YoY to Rs 57 crore.
In the last 10 years, the company’s gross sales climbed 581 percent to Rs 843.61 crore as of March 31, 2019. The net profit surged 113 percent during the same period to Rs 91.55 crore.
Considering the company’s stellar show of earnings and rally in the share price, the stock sits at rich valuations of 54.49x, while Blue Star and Voltas are currently trading 37.76x and 43.09x, respectively.
According to an earlier report by ICICI Securities, it said, “Despite higher raw material prices, Symphony has refrained from taking a price hike, which has resulted in erosion in EBITDA (earnings before interest, tax, depreciation and amortization) margin by 600 basis points YoY in FY19 to 26 percent and decline in PAT (profit after tax) by 45 percent YoY to Rs 101 crore.”
Analysts remain bullish on the stock. With the rising temperatures in many parts of the country coupled and low dealer-level inventory, Symphony is likely to record robust performance in the FY20, the report said.
First Published: IST