[Logan]

I think we should request Mr.Sharma (and FPIs) to take an active role (become a board member or take up an unofficial advisory role is he’s too busy) and guide them to make changes in the company. The reason people are panicking is because they are tired of not getting proper answers to their queries on time.

Mr.Sharma has not bought shares from open market but was allotted warrants and converted them to shares which means he had many discussions with the management. He converted his warrants to shares when FA news was there so he knows about the company properly.

If someone like him (who understands what investors want) advises the company regularly then we can expect better communication from the company.

We’ll support the company on business matters but corporate governance this year so far has been horrible. It was better last year but not this year. It’s too bad that we have to wait till conference calls to get any response from the company. I’d have visited the company if I didn’t have health issues. My health problems started late last year but recently it has become worse.

I don’t know when they’ll start giving importance to corporate governance and investor relations but the sooner they do that the better it’ll be for everyone. And strategic decisions too they have to look at various things before recommending/implementing. The second bonus was unnecessary and created more free float.

[Sobha]

Earlier our Hyderabad friends visited SKR in his office. That was very helpful. Can our friends from Hyderabad do it again?

[Rathi_b]

Meeting with SKR has been scheduled for Saturday. Any questions that you people want ask, please post it here. We, along with all other issues will take it up with him at the meeting.

[Sobha]

The dividend policy says about a pay out of above 15% of FCF. In first quarter the expected FCF is Rs 250 cr as per given guidance. So Rs 40cr can be paid out as an interim dividend which is 20p per share. If that is declared with quarter results, it can be paid without AGM approval. That will enhance confidence. Please consider suggesting so…

[Yogi]

Hello Friend: How many people are scheduled/allowed to meet the management? Can any of us join the team? What is the time of the meet and Where to assemble before the meet? Please give complete details for the benefit of others.

Best Regards,

[Logan]

@Rathi_b, it’s great to see you writing in the forum after many months. Hope you and all the Hyderabad members are doing well. Thank you for taking the initiative to meet the management and informing us about the meet.

These are my queries to the management, please review them once.

1) Update on SHP, there’s a mismatch in the SHP data provided by the company in the MCA website and in the exchanges. In the January SHP shared by the company, the promoter holding is mentioned as having 23,32,84,604 (23.32 crore) shares but in March SHP, without adding the LLP shares, the promoters’ holding has reduced to 4,24,31,791 (4.24 crore) shares. What happened to the remaining 19,08,52,813 (19.08 crore) shares?

In the conference call the CEO mentioned that he had not sold a single share in the last 12 months but his holding (without adding the LLP shares) has come down from 9,41,05,816 (9.41 crore) shares to 1,03,81,635 (1.03 crore) shares. Was there any off market transaction?

Still no information about this has been shared with the investors. Because of non-disclosure will there be any action against the company? How will you (the CEO) address this issue to the shareholders if there’s any action by SEBI.

2) Why haven’t you appointed CFO and CS yet? You knew that Mr.YSR would retire in March and you should’ve appointed his replacement before the retirement for smooth transition.

3) Update on MediaMint acquisition. Why is there a delay and no update on this? Shares were allotted to MediaMint people few months back but still its taking time to close the deal. Is the deal still on or is it put on hold?

4) Update on forensic audit.

5) Can you share the audited reports of all the subsidiaries?

6) Regarding acquisition of Audio Ad company, what payment options are you considering? Can you reveal the name of the target company?

7) The news of forensic audit, reduction in promoters’ stake, delay in crediting bonus shares has brought a huge negative press about the company and also the company is losing credibility. How do you plan to change that?

8) What steps are you taking to arrest the fall of BCG’s shares? The stock has corrected more than 60% and your actions aren’t helping it either. If this volatility is there, then all the retail shareholders will get nervous. We know that you don’t have control over the stock prices but if the communication is better we will get some relief. We don’t get answers to our calls, mails and we don’t know how to reach you in case if we have any concern.

9) Can you appoint any of the Big 4 as the consolidating auditor?

10) Update on FCF.

11) Instead of paying dividend, can you use the same cash to buyback shares?

[nitin_asce]

@logan @rathi_b I once saw a nanocap company website and was impressed to see audited subsidiary reports on their website. I consider this as gold standard for a company.

If BCG can do it it will be awesome. No doubt initially there will be lot of queries but if bcg can appoint one person to respond to queries the issue will be put to bed.

[radhutheoptimist]

There was a resolution passed to buy shares for Employee trust for ESOP. Isn’t right time to purchase that?

[vkhare789]

Questions on:
1. Financial Audit update
2. Shareholding pattern
3. Improving corporate governance
4. CFO appointment
If we can get answers to these, it will be a great help.

[Jdbull]

Plz ask why they gave FA notification in January and not in sep 21
What is the progress of forensic audit, and are they willing to give notification of forensic audit result or they will hide it too.
He said in concall that he didnt sell a single share then why share is missing,
If vijay kancharla sold his share then why they don’t give notification about it,
Daum sattelment progress
US audio company acquisition progress
Future of ad tech sector and competition in this sector
What is there plan in Indian market

Why promoter don’t communicate with shareholder now
In 2021 when share was part of bull run at that time they give every other information through bse. But when downfall is happening they don’t care about retail share holders

[tanv151]

@Yogi appreciate your message. Please note the group “HYD group” is already a sizeable team and we haven’t made any changes to it since the first meeting in 2020. It wasn’t an easy task to build rapport with SKR and to win his trust, in order to share our collective views of this forum with the BCG management and get updates.

At this point in time, I believe making any changes to it, will only result in opening the floodgates as many will like to become part of it and more importantly, we are not sure if BCG management will like meet a larger group. Please note the number of shareholders have grown multifold in the last one year.

Thanks for your understanding and support!

[kmr003]

@Rathi_b , Thanks a lot, you are savior again.
@Logan has posted most of queries,

Few points to stress,
1) Now BCG is not small cap like earlier, it is mid cap, (for some time this FY even large cap).
2) It is high time to change the past behavior and shift towards transparent CG.

3) Once Investor trust is lost, Very tough to regain. We experienced from last 8+ years. Why to spoil again.

4) Sentiment is fully negative. I personally feel can be changed by reputed management hiring from BIG companies and with transparent communication time to time.

5) They cannot run like earlier, if they do so, market will punish them hardly

[Logan]

@nitin_asce, I don’t know why they do that, in one of the conference calls the CEO said that since those reports contain sensitive information they don’t share those.

I checked their old annual reports and in the 2007 AR, there is audit report of 3 companies mentioned. Frontier Data Management, International Expressions Inc and Pennyweb. People were saying these weren’t audited at all and those companies don’t exist etc but even though the report is old it shows that those companies’ are audited and profitable since the day they were acquired by BCG.

Attachments:

1. Annual-Report-FY07.pdf

[hw_tw]

@Rathi_b and team

Thanks for taking the initiative once again for the benefit of all the investors

One important request from my side

If possible, please do record the conversation … video or audio anything would work

Sorry for the ask … this is to avoid any kind of criticism coming later that this is all scripted

Some checks from my side

– In case shares were sold even before the FA / Jan 22 SHP, please check the reasons for the same

– Plans to increase SHP (LLPs acquisition, Open market purchase etc; )

– Reasons for not publishing Audited results of subsidiaries and please insist on publishing the same with a clear timeline to do so even without Daum closure … Can’t take Daum as as excuse especially when the priority of this item is low

– If possible please ask for Audit documents of all subsidiaries and verify them … Make a note of any adverse comments you would see in these

– Check if the FA is for the asset impairment or for the entire accounts as stated in the SEBI letter

– Status of FA in terms of milestones achieved and target timelines if any … Please confirm if they are able to move forward without CFO and CS

– If possible please ask for latest mail exchanges between BCG, SEBI and Deloitte

– Ask for a live Product demo and any latest Report / Analytics page showcasing the overall Impressions count they are achieving on daily, weekly, monthly basis

I am not sure of the time you and others would be spending over there and the amount of details SKR and team would be willing to share … Please try to gather as much information as possible

[ramganesh1982]

Hi Rathi_b ,

extremely glad and great to see your msg after a long time in this forum .

I have only few requests to SKR ..

1) pls ask him to increase the promoter stake to more than 70% for the bloo*y sake of all patient long term investors . He is literally allowing this game play and should b well aware of the consequences of diluting the equity base without increase in Promoter holding . He doesn’t need to do great deal of work other than that to stop the stock from falling freely.

2) Maintain some decent level of corporate governance. We saw a series of updates on a regular basis in 2021 and when it’s beaten down in 2022 we don’t see any valuable or useful updates . Say , when doubts are raised about SHP a bse website update with latest SHP would have helped . After stock is getting beaten down bcuz of bonus there is some unwanted update about nature of business or revenue to make sure further damage is done ??? Why there is a confession that July month will b not good ??? And why it’s coming this yr ??

3) is there more scope for chaos in Aug when initial set of investors will get their preferential allotment

Regards
Ram

[sac6310]

seeing managment non response and action , i fear that something might be there in FA . As per my knowledge, disclosing of outcome of FA is not mandatory. i fear that soon it will be too late even for management to handle the damage in reputation and market cap. Also after MCA SHP revelation , am sensing that some outsider is trying for takeover .
This is just my views , other expert please share your opinion.

[JackSparrow13]

A hostile takeover would be just what the doctor ordered.

[smitsat]

BCG remains in ASM. Not included in List of Co. Moving out of ASM.

[m4max1979]

Dear Hyderabad Team,

I am sure you must have already covered most of the questions for the meeting. I also have a question for SKR.

I refer to an article in economic times regarding Brightcom being removed from Kotak Nifty Alpha 50 ETF on June 30. Could you ask for his opinion on the matter. Why was a reputed fund leaving in such a short time.

I ask this because the last presentation they uploaded, they shared names of nearly 100 institutions and funds invested in the company.

[Raveendra]

Dear m4max1979,

The index fund will automatically rebalance at the end of every month. Last time BCG was added by this fund due to high alpha generated by BCG and also high allocation in that fund I think.

Now it’s due to poor alpha , it will be removed from the fund.

There is no much fundamentals involved here.

Having said that, there will be more volume for sale on June 30th or around , that may cause more LCs unless the volume is absorbed by other FII.

Regards,
Raveendra.M

[Author]

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