X2UtT6YnKl1UX_rgIlep6g/53334/533333871/5337038.jpg' alt='Watch The Net 2.0 Online Forbes' title='Watch The Net 2.0 Online Forbes' />Find the latest business news on Wall Street, jobs and the economy, the housing market, personal finance and money investments and much more on ABC News. CRAYON Create Your Own Newspaper. The webs first personalized news service, custom news, headlines. Watch The Net 2.0 Online Forbes' title='Watch The Net 2.0 Online Forbes' />Symphony Beating the heat with its air coolers. Achal Bakeri, founder, chairman and managing director of Symphony, had sold out all the units that he had manufactured in the first year of production. Image Joshua Navalkar. Unlike most entrepreneurs in the white goods segment, Achal Bakeri, 5. Nor does his venture Symphony Ltd have a finger in every pie of the sector. A single product company, it devotes all its resources to what it does bestmaking air coolers. Symphony develops its products in house and provides the tools for manufacturing, but outsources the final assembly to third party plants. Its employees look after vendor management and quality control. It is this asset lightand consequently capital lightmodel that has made the stock a favourite among investors. Shares of Symphony, which could be picked up for a little over Rs 1. Rs 1,3. 64 on BSE on July 1. More importantly, Symphony has chosen to return cash to its shareholders. Its return on net worth has always been above 3. Returning excess capital to shareholders is the hallmark of a good business and shows that the interests of the promoters are aligned with those of minority shareholders, says Utpal Sheth of wealth management firm Trust Capital. Devoid of major heavy assets, Symphony has been modelled as a product innovation, marketing and distribution company, says Bakeri, founder chairman and managing director. The result has been a clear pole position in the domestic air cooler market and financials that are in the pink of health. Revenues in FY1. 7 grew to Rs 7. Profits, too, have kept pace, expanding at 2. Rs 1. 65 crore in FY1. More recently, Symphony has created the niche market of industrial cooling wherein large factories, warehouses and halls are installed with Symphonys air cooler units as a cheap alternative to air conditioning. Also, with two overseas acquisitions, the company has every chance of making a major dent in the international market. While the company has been asset light from the get go, the single product strategy was adopted after missteps in diversification led to bankruptcy less than a decade after its first summer of sales in 1. Bakeri, a scion of realty major Bakeri Group, had started the business that year on his return to India after completing his masters in business administration from the University of Southern California. A year earlier, the family had installed an air cooler at their residence in Ahmedabad. While the cooling was satisfactory, the product was an eyesore, recalls Bakeri, who was convinced theres a market for a more aesthetic product. Symphonys first air coolers had a dream debut. Watch Tramps Online Tramps Full Movie Online. Though, at Rs 4,3. AC that cost around Rs 3. The first batch of about a thousand were sold out that summer. Bakeri, who had seen his family struggle with collections in the real estate business, was clear that he would not extend credit to anyone when he started Symphony. Even today, the company pays its manufacturers upfront in exchange for cash discounts and supplies to dealers in exchange for immediate payment. Well known chains like Tata Croma and Vijay Sales, though, are allowed short credit periods. This frees Symphony from the burden of working capital requirementsit does not have to borrow for its day to day operations. After the initial success, Symphony progressively expanded sales across Gujarat and then across India, with the help of an aggressive marketing strategy. In 1. 98. 9, we might have clocked sales of Rs 3. Rs 1. 8 crore on advertising, says Himanshu Shah, director, sales and marketing, at Symphony. Liberal advertisement spends helped it become a national brand. In 1. 99. 4, the company went public raising a little over Rs 1. And then, the music stopped. Being a publicly traded company, analysts, at meetings with Bakeri, stressed that Symphony is focusing on just one product, whereas competitors like Usha, Crompton Greaves and Polar were multi product companies. Moreover, air cooler sales were dependent on a hot summer and Symphony needed a range of all weather products, they opined. Seeing reason in the argument, Bakeri started diversifying his product range in 1. Watch This Is It Dailymotion. However, he had underestimated the competition in these categories. The next 1. 4 years were the toughest in his life as he witnessed the net worth of his company erode. Compared to a profit of Rs 3. Rs 5. 1. 6 crore in 2. As Bakeri told Forbes India in a 2. We spent seven years digging a hole and then seven years getting out of it. In 2. Board for Industrial and Financial Reconstruction BIFR, the government agency that assists in the revival of sick industrial units. The market for industrial cooling is largely untapped and Symphony is looking to grow from scratch. Having burnt its fingers trying to diversify, Symphony now decided to focus only on air coolers. It emerged from BIFR in 2. Symphony 2. 0 with a single product strategy. Watch Romeo Must Die Online. The move came up trumps and eventually catapulted it to the position of market leader in air coolers. The battle scarred Bakeri is candid in admitting that without the experience of seeing his company crumble, he would probably not have created the Rs 9,4. July 1. 1, 2. 01. Symphony is today. And with the phoenix like resurrection near complete, he is now expanding the global footprint, in what is Symphonys third, and possibly most exciting, phase of growth. While Symphony went about expanding in the domestic market, it is its two international acquisitions that provide further insight into the mind of Bakeri. Even as a global player, he retained the same asset light model. In 2. 00. 8, the company acquired International Metal Products Company Impco, which was started by Adam Goettl, who patented the first ever air cooler in 1. After a series of ownership changes, the company had ended up in the hands of American private equity group Castle Harlan that was looking to sell. Symphony paid 6. Rs 2. The debt helped it get a tax write off and the 6. Symphony paid was recovered within six months of operations. Their respect for capital is phenomenal and this shows in the low price they have paid for their overseas acquisitions, says Nilesh Shah of Envision Capital, a value investing firm and a Symphony shareholder. With Impco, Symphony lost no time in converting it into a low cost operation. The company was put through the Mexican equivalent of Chapter 1. Real estate was sold and manufacturing was discontinued coolers were supplied from India. Bakeri is now expanding the companys global footprint, in what is its third and most exciting phase of growth. Impco was a pioneer in industrial cooling and Symphony brought the product to India where it has been installed in places like yoga guru Baba Ramdevs ashram in Haridwar, an L T factory in south Gujarat, Decathlon stores in Ahmedabad and Ludhiana, a Hitachi factory in Ahmedabad and parts of the railway station in Kota. Bakeri says the market for industrial cooling is largely untapped and the growth potential is huge. We have to create a market from scratch, he says. Many factories in India are very hot during summers. While installing air conditioning would be very expensive, we tell customers that air cooling is not only cost effective but would also improve the productivity of workers. Even as the synergies with Impco were playing out, Symphony, in 2. Chinese air cooling company Munters Keruilai. It paid Rs 1. 5. 5 crore for the company that had a thriving industrial cooling business. As Bakeri explains, The market in China for air coolers is 2. India but also very fragmented. So even a small slice of a large pie is a lot, he says. Since the acquisition, Symphony has made China its base for industrial coolers, from where they are manufactured and shipped all over the world. Importantly, even though Keruilai was acquired for a song, it had no debt and the book value of the company was higher than what Symphony paid.