Previously I have written about how to identify stock investments
Like Peter Lynch here
Using Pause and Play here
By following smart money here
One of the pointers in Ten point investment map is to identify whether company has sustainable competitive advantages. Many of the investors have this question on how to define/find competitive advantage of company. We will try to ascertain competitive strength of Symphony Ltd one of our top picks in Model Portfolio. I am borrowing heavily from Warren Buffet’s letters to his shareholders.
1. Will Company be in business for next 10 years ? Is there a big market to address – Symphony limited makes air coolers, also known as evaporative cooler, swamp cooler, desert cooler and wet air cooler, works on the evaporation technique; it uses the hot air in the room and water to generate cool air. This is what I picked from there 2012-13 Annual report
In India,about 132 million households live in hot dry climatic regions (about 54% of the total) and about 11 million households live in moderate climatic regions. This represents an aggregate 143 million households (58% of total) of potential customers.
So we can safely assume that there is a … Read the rest