FY23Q1 concall notes
- Highest ever Q1 quarter sales (13% over Q1FY20), significant increase in volume
- Haven’t taken proportional price increase to increase volumes, despite this have maintained gross margins due to value engineering and product mix change
- Channel inventory is normal
- Subsidiary accounted for 43% of sales and 44% of EBITDA
- Gross margins are slightly higher than pre-covid (Q1FY20), EBITDA and PAT margins are lower due to higher advertisement, freight, change in warranty estimates, D2C and e-commerce channel
- US demand is very strong because of a hot summer, however due to recession and inflation concerns retailers are giving discounts which has to be absorbed by Symphony
- No significant market share shift in India
- Market share in Australia ~ 30-35%, Mexico ~ 35-40% whereas it is low in USA which is a huge market where company is looking to penetrate. Most USA sales happen in Q3 & Q4 of Indian fiscal year
Growth drivers:
- Mexico & Australian markets are low growth and they already have sizeable market shares
- USA should lead to higher growth due to increase in penetration
- Greenfield in Brazil should also unlock a growth avenue
- In India, domestic residential should be a growth driver. The Large Space Venti-cooling is a nascent market which Symphony is trying to create
Disclosure: Not invested
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