Symphony Limited (517385) Investor update summary

Strategic divestment and capital reallocation

• Board approved exploring divestment and monetization of stakes in Climate Technologies (Australia) and IMPCO Mexico, both 100% owned subsidiaries, to improve capital efficiency and management focus.

• Exiting these subsidiaries is expected to sharply increase core ROCE, with historical numbers indicating up to 583% on core capital employed if these are excluded.

• The divestment process is underway, with investment bankers appointed and preliminary buyer discussions initiated.

• IMPCO Mexico is profitable but capital intensive, while Climate Technologies has been a drag on ROCE with negative EBITDA.

• IMPCO Mexico will fund the technology transaction from internal accruals, supporting optimal monetization.

Technology and IPR transaction

• GSK China will sell technology know-how and nine IPRs to IMPCO Mexico for $5.1 million (INR 43.5 crore), developed specifically for the Mexican market.

• Proceeds will be used by GSK China to repay intercompany loans to India, improving capital structure and tax efficiency.

• The transaction is structured to comply with all regulatory and transfer pricing requirements.

• GSK China expected to become debt-free through internal accruals and sale proceeds.

• GSK China retains 52 IPRs, ensuring minimal impact on its future performance.

International and domestic growth focus

• Management aims to focus on high-growth, profitable segments in India and direct exports to key global markets like the US, Brazil, Europe, and the Middle East.

• Despite subsidiary exits, the company will continue to pursue international opportunities via exports and trading subsidiaries, especially in the US, Brazil, Middle East, Europe, Southeast Asia, and Africa.

• New product launches in India, including tabletop cooling appliances and compressorless water heaters, are driving growth.

• Growth is driven by new product categories, rural and semi-urban penetration, and favorable seasonal conditions.

• US market opportunities have improved due to high tariffs on Chinese imports, making Indian exports more competitive.