Sumir Chadha of WestBridge Capital summarises the business and rationale for investment in Astral. They had invested in Astral in March 2012 when market cap was sub 500 crore and today it is more than 5000 crore (they have partially exited this year)
Astral – impenetrable moat:
One of the things we loved about Astral was that when we spoke to plumbers in India – our team went and spoke to 1,000 plumbers across the country -they said they loved Astral. Because over a decade Astral has gone out and reached out to them, built the brand and these are the decision makers. So, when we get the pipes replaced in our house, none of us know which pipe is going inside our house, except for the plumber. So, Astral built this very powerful brand in India. That is why they were able to grow 40% a year for eight years in a row. They could scale the business beautifully. It is very hard for a competitor to come tomorrow and change all these plumbers minds. Because over many years they have built a lot of comfort with the brand, it is reliable and very high quality. If a company has a long term competitive advantage like that, it can win in the market place and make money for our investors.
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