General Discussion

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    Registered Boarder

    I am also in to be a part of this association.

    What are steps to fire existing CEO and appoint a new one? Company is built by long term shareholders. Our hard earned wealth is getting eroded by crappy management. We really need to unite and take action to change management else our remaining wealth will also go in dust.

    Registered Boarder

    Hello All,

    @logan request you to take lead of the association.Guys be fast,once we form association we can go to shankar sharma may be for suggestions.

    Yes i agree with many,CEO should step down and should take care of operations in business.

    We need to act fast now,already it is too late,stock price is almost 90 percent down from 52 weeks high.

    Guys act fast.

    Registered Boarder

    The time has come to fire up all investors. Every day, the stock market makes 52-week lows as if there is no tomorrow.

    Firstly, I don’t understand why the hell the stock price has fallen so much. Even a penny stock with no revenue sustains a better level of fall than this.

    We cannot wait for the forensic audit, as we don’t know the exact timeline. Even after outstanding financials, the stock price is behaving like it is going into insolvency.

    We need to be clear with the CEO: we don’t want an entertainment package, we are damn serious this time, and if you cannot solve past issues, please step down.

    This group should generate fire rather than write messages and get frustrated. We need to act. This time, SKR has crossed limits, and we have to ignite fire in the minds of investors.

    If the stock price cannot go up or sustain at least a reasonable valuation during its best performance, when the hell will the stock be valued at 30 PE during its bad time?

    Guys, we have to act, and then something will happen.

    Registered Boarder

    Yes Logan sir kindly be the captain of this movement .
    If we are not taking any action against the negligence towards us ,what is the use of a connected community ?
    All members this is a do or die situation it is individuals responsibility act sensibly rather than creating stories and blah blah blah discussions …
    The 7K member telegram group is a utter waste in taking any action in favour of retailers.

    Registered Boarder

    @logan and fellow investors

    I support association formation & ready to contribute financially as well.

    Registered Boarder

    In my humble opinion, before taking any step, lets request SKR for a meeting. The only two agendas of the meeting should be
    1. Why there has been no concrete step taken by the management after the value has eroded by more than 80%. Is he not concerned about the image/positioning of Brightcom in the public?
    2. What is the plan for closing the pending issues and how much time will they take.
    If we do not get satisfactory answers to these, I am in favor to pursue any legal step that the association may deem necessary.

    Rising Sun
    Registered Boarder

    Hello Everyone,
    I may be wrong but my understanding is that the prices are down or have been kept down due to the mystery 18% promoter shareholding which was pledged, with some financial company or brokers. Hence the liquidity and resulting volume of shares. Why has the management not taken back the shares from the brokers? The pledge was for a very small fraction of shares.
    If this mystery is solved then, hopefully we will get all the answers.

    Registered Boarder

    I have drafted the, Please let me know any corrections

    About Company

    Brightcom Group (BSE: 532368 , NSE : BCG ) is a public listed company , leading global provider of comprehensive online or digital marketing services, has over 20+ years of experience also included in NSE 500 list, ISIN Code INE425B01027
    As per company published results Brightcom group is financially sound with last year Sales of 5,020 Cr, net profit of 912 Cr and net cash flow of 618 Cr, Total Assets of 7,030 Cr .
    We trusted on SEBI, and we assume all published results, SEBI has close watch on accounting frauds.
    As per published records BCG is growing at faster rate than other listed IT companies over last few years, We group of long term investors invested in BCG at various stages, starting from 2 Rs to 120 Rs, We believed in growth of company.

    About Concerns from retail investors

    BCG price has given negative return of 80-89 % over past 2 years, We believe market will have corrections, but we feel BCG management attitude and carelessness is main reason for this, not addressing investors concerns are the main reason for this major fall.
    1. Management never follows corporate governance (CG), breaching CG is common for BCG, few are
    dividends credit, bonus credit, publishing results on time, AGM on time
    2. In Conference call CEO will promise few action items- but it will never be done on time
    3. Few legacy issues like DAUM, loan, appointment of CFO, CS company is dragged and still dragging in few, but CEO will give false promise of resolving in weeks / months.
    4. Currently Company accounting books under SEBI’s forensic audit, but this was published even after 4 months of notice from SEBI.
    5.Compnay has raised funds to acquisitions. it took almost 1.5 years to publish name of acquisitions. later it got cancelled and converted into joint venture.

    What changes we need, This is need of hour

    1. To Change the CEO of Company, currently Mr Suresh Kumar Reddy,
    We have huge respect on him, in terms of growth of company, business and product development, but not right person for public listed company, Mr Suresh Kumar Reddy failed to implement every Corporate governance actions, to name long list.

    Hire reputed CEO, who has proven experience to handle the situation.

    2. Appointment of one board of director from retail investors side,
    there are 4 lakh retail investors active

    Rising Sun
    Registered Boarder

    There are some key questions also relating to the funds which the company holds in its subsidiaries:
    1) Why they don’t earn interest by investing in short term money market funds. The interest rates are so high across the globe.
    2) Can the company not just submit a certified bank statement showing the bank balance across subsidiaries?
    3) Why will the LLP’s sell their shares, if the same doesn’t need to be acquired by another party on the other side. I am sure all the LLP selling is as per planning done by SKR. Because they have themselves acquired stake by buying LLP’s.
    4) Why has the management not got back the pledged shares back as yet? When will they get it back? Who can sleep well if 18% of their stake is sold by brokers/financing companies to whom you have pledged.

    Regarding the cashflows:
    1) Considering the growth of 40% in the past 1 year, the estimated cashflows of 250 crores should have also increased. But the same is not evident since the past 2 quarters.
    2) Earlier once the company had presented a Debtors statement, and mentioned that 100% of the receivables are valid and no provisioning was required.
    3) No discussions are being done on the cashflows part since the past 2 quarter conference calls.
    4) If I am not wrong, they had recently reported 1200 crores cash balance (Quarter ending September 2022) + around 100 crores in quarter ending December 2022. Management also said the current quarter cashflows will be high to include the cashflows of the previous quarter too. May be we will have cashflows of around 400-500 crores. This all will take the total balance to around 1800 crores.

    Please correct me, if I am thinking on the wrong side. Of course all this is valid, if the company has real business, and SKR has control over the funds at subsidiaries.

    Lastly, I would like to mention my understanding on the price fall:
    1) Nobody believes in the cash balance reported by the management.
    2) LLP’s selling shares – which has brought down the price.
    3) Investors loosing confidence, and hence no buyers when the prices fall down.
    4) I sincerely doubt retail investors are doing this volume.

    Whatever is happening is known to the management, and their close people. This is for sure.

    We just need one answer:
    When will the pledged shares come back to promoters holding?

    Registered Boarder

    When I suggested that we should look at someone to represent retail investors, it was not to oust the CEO from his post but to have more voice and to make the company take investor friendly decisions. I think even Mr.Shankar Sharma will not agree to a move that will oust the CEO.

    It’s true that the valuation of the company and the fall in stock price is because of his actions but we should not forget that the company’s business has grown to this level because of him. When other companies are struggling, BCG is doing very well. Only if the company does well there’ll be value else there’ll nothing.

    The important point is that it’s easier to fix valuation related issues anytime, prices can go from high to low and low to high but it’s not easy to fix business related issues, especially in the ad-tech industry. Once your business falls to certain levels then it’s almost impossible to get back on track. Many companies have gone bust and even giants like Yahoo, AOL etc have struggled and sold to other companies. Few years back Google and Facebook were only the ones which very dominant but now even Microsoft and Amazon have become big. Even smaller names have fallen a lot, Magnite fell 90%, PubMatic 80%, Even TTD had fallen more than 60-70%.

    The issues that BCG has (that are in management’s control) are fixable. Timing is the main factor. If they released the audited reports 3-6 months back then we wouldn’t have seen this much negativity. Had they issued bonus immediately, appointed CFO and CS at the right time and directly announced the JV instead of saying it was Acquisition at first then the situation would’ve been very different. It’s different when you need 100 runs in 60 balls, 60 runs in 30 balls and 30 runs in 6 balls or try attacking when you have 10 wickets remaining than 2-3 wickets remaining. The CEO doesn’t know when to play attacking and when to play defensive. He needs a good coach who can guide him. Sometimes it does look like he doesn’t care so that time the board member or the adviser too has to be strict.

    Close DAUM issue, improve communication (corporate governance), don’t delay things like dividend, bonus, appointment of key people, give proper clarification on SHP, announce the JV plan as JV and not as acquisition. Tell us the truth – whether you will get the shares or not. If all these are done properly and in the future if mistakes aren’t repeated then the market will recognise the changes and give good valuation.

    We should do as @ved suggested. First we should talk to him and make him understand our pain, concerns and frustrations and ask him directly whether he gives importance to all the above. If he doesn’t answer properly or if everyone feels that he’ll not improve then whoever wants to take necessary actions can take them.

    In investing I’m more interested in the analysis part than being an activist. I studied the adtech industry for years and then only I started writing in the forum. I try to do the same for all my investments. Sometimes I study and then invest and other times I invest and then study. I can suggest steps but to execute that you need someone with good skills and management which I clearly lack. And I don’t think I can handle all that pressure and expectations with my current health and it’ll impact more negatively.

    Let us request a conference call only for this i.e. let’s not discuss other topics and focus on sharing our pain and concerns.

    Registered Boarder

    Agreed . But our Hyderabad members have already met him many times and he always gives the promises that issues will be fixed soon . We have not seen any convincing steps til now to boost our confidence . So this time he should feel the heat of investor frustration , our movement to be bit more agressive .

    Registered Boarder

    I agree with you, Logan.

    But we do not understand what we are missing. We are missing the “golden days” of BCG when its financials are outperforming.

    CEO’s immature act has killed the stock price. SHP/Bonus issue/late audited susbsidaries results. There is a big loss of trust, and when there is a big gap in trust, negativity is on the rise.

    The problem is negativity on the rise when a company is outperforming.
    If negativity is rising, the CEO should answer it with actions. It is his duty towards shareholders.
    The CEO should answer the mismatch in SHP and other problems directly by showing us proofs, e.g., this is what has happened with pledged shares, and we are going to do this.
    If he had been transparent, nobody would have questioned him.

    What use is business growth when management is not ready to improve corporate governance?

    We, the group of shareholders, should understand that unless and until BCG management improves, the share price will not rise. (A forensic audit may take time to come.)

    So our role is to question the sleepy management about why they are not answering simple questions like,
    SHP mismatch: management should answer it first. This has happened, and this will be our action.
    Daum issue: every time there is a fake commitment, management should give direct answers.
    Buyback–what is the issue? I don’t get it. If you are at or above Rs. 1500 crore, then buyback, as your company is highly undervalued.

    This is a simple question, and if he cannot answer it, then what is the use of the company growing?

    We should be aggressive now, and we need straightforward answers.
    We should act now as equity is way too high and the operator will finish the game of BCG.
    Act now, guys!

    Registered Boarder

    If we together can act ,then only something will happen.

    Or else we will write essays over here and nothing will happen.

    Sorry to say that but this is the hard truth.

    Registered Boarder

    The frustration level of all investors of Brightcom is palpable. The extremely low valuation of the stock price, with a PE of just 2.6 against the industry PE of 28.39 (as per Moneycontrol), and the current Marketcap of just 3552 Cr is the main reason for this frustration.

    It is obvious that the stock is being manipulated by the operators but the reason for the same is not clear. Obviously, as investors, we expect the promoters to step in, in whichever way they can, to curb this price manipulations … unless the promoters themselves want it to continue. This, lack of corrective action by the promoters, is the main reason why a lot of people have started using abusive language against the management.

    I am not clear as to what we, as the investors in the company, can do to prevail upon the management to take some positive actions, other than sending them emails etc.

    Since the company is performing exceptionally well, with very sound fundamentals, and is quoting at such low valuations, I wonder why some Biggy (like Reliance/ Adani) have not planned to take over the company through an Open Offer.

    Registered Boarder

    Hi all, we the Hyderabad group agree with the suggestions that we need to have a call with SKR before we take any other steps. Having said that we believe this time we can should have some more knowledgeable long-term investors In this call. But we cannot add a lot of people in this meeting for obvious reasons so we suggest restricting the numbers to three more people that everyone agrees with. Please suggest who you think these three new people should be and we can then try to work with the management to get us a meeting with the new set of people that are nominated.It’s heart breaking for us to see the price fall to where it is right now and please nominate by the end of the day because the sooner we can come to an agreement amongst ourselves on the forum,the earlier we will set into motion the necessary steps required to arrange the call.

    Registered Boarder

    My suggestion would be that they conduct a special call like they did in January so that no one can point fingers at any particular individual or group. This way each and every investor can participate.

    The topic of discussion should be limited to the stock price crash and what plans they have to improve the sentiment. Other topic should be on the SHP – they have to give proper details and tell us why it was revealed so late and no details have been released even after a year.

    We all can discuss and come up with relevant queries and form a list of questions. Investors who get a chance in the call should also stick to those questions and don’t let him finish until he gives a correct timeline. For ex if DAUM takes 6 months let him say 6 months instead of saying very close (for 4-5 years he’s been saying that).

    Registered Boarder

    Dear Rathi_b, I appreciate and support your view. I also agree with Logan that, let’s come up with a list of questions and stick to it. Then, it does not matter who is asking. If we have to nominate someone, my vote is with you and Logan. Please request SKR for a meeting.

    Registered Boarder

    I agree with logan, let the management conduct special call and notify through exchanges. Thank you Rathiji and team again for taking initiative.Request ceo for special call only on specific questions. Till then let us list a few points.Request him to be straight forward this time

    Registered Boarder

    I see your larger point here @Logan and I also agree with @akki and @ved. The email ids of the compliance officer, CFO and SKR are available on the website, let’s all write a mail individually asking for the call from the management. Please ask that the call should be in the lines of May 2019 where 120 minutes were allotted and all the questions asked were patiently answered. Please let’s also prepare and send the questions that we want answered by the management and asking them not present opaque answers, but to give answers that actually show their intent. I hope all the members will write the mail to the management in this regard because if all of us ask, they just can’t choose to turn their face the other way. We all have our aspirations and goals of financial freedom attached to brightcom I request all the members to write a mail in this regard. Please also involve the people from telegram and other social media to drive this point home.

    Registered Boarder

    I have mailed ,request all of you to write mail.

    Rathiji please try to convey CEO directly to conduct a special call.

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