Brightcom Group Q2 conference call update

Anand, I have attended the conference call. Here is my updates. Skr as usual told everything is going good. Daum settlement still in progress. They have a meeting in this month end where they try to get into some agreement which can be communicated to market. They are trying to consolidate all the entities into one and a newyork based auditor will be onboarded for this. Ey already auditing in Israel. So 40% already audited by big4

He talked very positively and confident. He went to the extent of asking a retail investor, not to do anything drastic now as company is on the inflection point. Literally he was urging him to hold on and have patience for some more time. As BG mentioned, promoters cannot go for preferential share. They can take the money back once it is available.

preferential shares is still lot of smoke and mirros.
I think once things settle down with Daum lehgally then LOC will be in place quickly and preferential issue wont be needed.
Noise just putting stock under pressure and so also Daum under pressure to sign on the dotted line.Dam also cant keep going indefinitely. So their patience also must be running out like hahahaha us retail investors here.
All good. Give it time.
We hit pe ratio of affle in 15 months to 2 years time if all goes as per the plan as growth rate will also shoot up once LOC is in place.

Also there was a retailer named Ray asking questions on PL account. Guess, the CFO explained. Is that headstead?

Thanks for the response. Heartening to know that headstead is still active in the counter though not writing in forums due to reasons we all know. Hope someone inform him of this forum and ask him to share his ideas.

Thanks for updating us

Iately i have from my side given a short brief about this company and the opportunity it presents to many of my HNI clients and they are showing interest . Also have spread the word through my various family and friends whatsapp groups. Hoping for a good grab of this investment idea. Some of my friends have purchased in small quantity. Expecting the same support from all of our retail family . Our collective might will surely yield the desired results really fast.
Finally the trick to become rich is when it is raining gold don’t stick out a small jug but to load up the truck.

Update from today’s concall:

Low CMP:
Suresh said the they are do not have any control in the stock price but ensuring that business is running well. Agreed that value realization has taken more time than unexpected. Said company is taking steps to resolve all issues like Debt, Daum, Big Four auditing, LoC etc and working to resolve issues one by one. Requested the retail investors to show patience for some more time and that company is at inflection point.

AI/ New technology/ Wearables:
Gave general update on importance of AI in agriculture, food, medical field etc. Brightcom also focusing in AI in digital media as well as Agri AI. Though only small contribution to the top line as of now, company is treading cautiously and not throwing lot of money it. Not only AI but other science based deep tech is being explored by the company to stay relevant in the industry and have few ideas in the mind which will be taken on in the times to come. The wearable (band and ring) is in back burner, it is still in the work and have not discarded the product or the technology but the focus right now is to sort the current issues first and later work on these launches.

Daum settlement:
It is still work in progress. Next meeting with Daum in the end of Nov to get agreement in place so that the amount to be paid to Daum can be announced to public. Following which the money to be paid will be lined up and any payment in this regard will further bolster the confidence of investors. Agreed that settlement discussion is taking quite a long time but hope the next meeting will fruitful.

Axis Bank Debt Closure:
There is little change in the settlement amount mainly in some of the parameter and that i being worked resolve it. Assured that later in Nov some announcement will be made in this regard.

Big 4 Auditor & Consolidating all subsidiaries:
Working with a renowned Big 4 auditor based in New York to consolidate all subsidiaries in one. This US entity will also help to facilitate financing initiatives being lined up. About 40% of revenue business is already audited by EY (a Big Four player) and rest by local players. Once the process is over, 100 % will be audited by Big Four auditor. When asked about the expected timeline, Suresh said it could take three months.

Pledged shares:
Selling of around Rs.40 lac worth pledged shares by one of the entity (Comfort Fincap) recently had created confusion in the market, this was primarily due to miscommunication between both parties. This pledge was for personal loan taken by Suresh. When asked about the figure of pledged shares to be released on closure SBI & Canara bank loans and the remaining pledged shares post that, Suresh said he do not have figures at the moment and will share the details probably as an investor update to the exchange.

LoC:
Once the issues are sorted, looking to bring investors – DII or FIIs. In his recent visit to New York he met with investor relations and investor bankers to line that up. Plan is to bring the investors in a way that equity is not dilution (like secondary buy from market or other method) and this is being worked out with reputed auditor based in New York as discussed above.

Dividend Policy:
Clearing of debt is inline with LoC (pre conditions for LoC) and also pave the way for dividend distribution as the Free cash flows gets improved when debts are paid. He said that he came to know few investors were skeptical with dividend policy declared but assured that it will be better in longer run when FCF improves.

weEndeavor Group and role of Jacob Nizri:
We-Endevour is a a group of executives who are with BCG. This group was formed since BCG is unable to give them stock options from the company due to issue with International issuance of stocks (basically in Israel). The group have more freedom and they still part of Brightcom Group and manage Brightcom Group. They have flexibility and freedom to work on non-conflicting business areas. weEndeavor is an entity which BCG does not control but instead BCG is contracting individuals from weEndeavor and is more of an arrangement to tackle the complex employment laws in Israel. More of an arrangement between Jacob Nizri, Shahar, Shirley and Yaniv. These four individual are in the business with longest time in terms of industry experience and this is a convenient structure for all parties to flourish without any conflicts.

Affle Valuation and Discrepancy with market:
Suresh said last week one analyst had a call to discuss about the Affle valuation and the reason why BCG lagging behind in spite of much ahead of Affle in many of the parameters. What Suresh is trying to do that even if he is not able to grow the business this year for example and instead work only on the steps to bring back confidence in the stock by changing the perception, the Market Cap of BCG will also be in line with these players. Assured that he is working to resolve all current issues and reiterated the company is at an inflection point. Timelines cannot be given as some things not in their control for example the NOC was obtained very late in spite of clearing debts this July. Affle is a fresh company which took entry into the market and was able to take the advantage to get the market potential. BCG will also make trust building measures to clean the reputation in the market. Like how the investors are frustrated, the management is also bothered and looking to get the credibility in the market.

I also thank Headstead sir Ji , Ian and all others to represent thousands of voiceless small retailers.great sir

Dear shoumik, I am not to be considered a retail leader but just an average Joe who likes to share thoughts. I am also giving disclaimer that I am not sebi registered or from finance background and do not make your buy/sell call based on my feedback. Having said this, I was sort of amused to hear your open comments. Coming from mc where each and every positive comment was deleted, it was a refreshing change here where we can discuss on our thoughts and share knowledge and information.