[Logan]

@Longplay55, sorry for the late reply.

Recently I saw 44 Ventures LinkedIn post where they had mentioned that they (including their group companies like OMS, Boldwin, Literally Media, Onomagic etc) continue to support their global clients and that they are resilient and unwavering. I’m not sure how much the recent events impact OMS but it’s good to see that the company is committed to both its customers and the country of Israel. Since these are mostly tech companies, they can adapt to different situations as we saw during COVID times. Most of the staff working there are in sales and R&D. The operations and support team is in India.

What I’m worried about is the leadership vacuum in the parent company. The people who were supposed to protect us really backstabbed us (SKR, the auditors and the CFO) and others who were supposed to take responsibility during tough times are walking away (like Mr.Peshwa). I really appreciate Dr.Radhakishore Pandrangi taking up the director’s post and as per recent updates from the company, that he is involved in appointing the next CEO and CFO. Being a new person to the company, the task will be hard for him, especially when the two senior most people are not available (CEO and CFO).

The root cause for every situation is SKR. He took everything for granted and because of his stupid actions, everyone is suffering. He was so careless and stupid with the PW issuance and no one can figure out how he thought he could get away that too in this digital world where getting confirmation on transactions will take mere seconds. I knew that he was careless and lazy but the thing that he does every time i.e. doing something without realizing the consequences is the worst part. He did it with the PW issuance, SHP, bonus shares, and he thought of the parent company as a thing that he could play with. Many bad people will be pure evil but SKR is stupid evil. He could’ve avoided so many things and everyone could be happy but he chose to do those stupid things anyway because he’s that arrogant and careless. He didn’t see shareholders as human beings but as objects. He was so arrogant that when asked about few of his stupid actions, he was dismissing those and replied giving nonsense justifications. And we had plead and beg just to get basic information about the company. I always thought that he would change his arrogant attitude as the company grew because the scrutiny would be more but the progress was very slow. By the time one issue gets resolved, we could bet that he’d create another bigger issue.

I’m not sure whether the board is really putting efforts in searching the new CEO and CFO and the auditors. We should put maximum pressure on the company till they appoint CEO and CFO and the new management should put efforts to get rid of the mess created by SKR. If the board has any common sense, they will appoint new people before SKR gets arrested. They should direct him to give proper handover and explain the workings of everything in the company because he was handling everything.

The day after the second SCN came, the company shared a notification where they mentioned these –
-We fully understand that news of such nature may raise concerns
among our valued shareholders, and we wish to reassure the right course of action
will be taken.
-Upon receipt of the order, we immediately set up a dedicated internal team to
thoroughly review the details and implications. The company is evaluating potential
action courses to address this situation effectively. We are in consultation with legal
experts to ensure that all our responses are in the company’s and its shareholders’
best interest.
-We thank you for your continued faith in our company. We will navigate through this
situation, keeping our long-term vision and the interests of our shareholders at the
forefront.

All the above are mostly SKR’s words and don’t know much we can trust those but if the company/board is serious then they should do whatever they can to protect shareholders and stop treating us like objects. Lakhs of shareholders are counting on them to take necessary actions and they should not disappoint us again.

[Longplay55]

@Logan ji, …..Sir, thanks a lot for detailed reply….I like your differenciation between ‘pure devil’ and ‘stupid devil’….which SKR (SOB) is…..let’s see what lies ahead …..I wish all the very best to Dr. Radhakishore Pandrangi for next subsequent actions to be taken on BCG’s board……by the way, in recent past, Vangaurd & Nippon have been increasing their holdings in BCG.

[Logan]

I expected few key people leaving the company because of SKR’s careless/reckless decisions and I’m not surprised seeing Mr.Nilendu resigning. SKR shot himself in the foot and he has put shareholders in a difficult situation. The board (including Mr.Nilendu) was supposed to check all these on behalf of shareholders but they just rubber stamped everything. Now we have to rely on a new person (Dr.Radhakishore) who will not know the operations properly and who might need time to understand the complete situation. I don’t know what the other co founder is doing. Since he doesn’t have much holding, maybe he’s not caring.

A strong leader is the need of the hour and I hope Dr.Radhakishore is one and I will really appreciate and will forever be grateful if he and the board take decisions which will bring the company and its shareholders out of the mess created by SKR.

Like mentioned before, two good things which SKR did was – one is acquiring OMS (and keeping it somewhat independent) and the other is keeping the company debt free. If at least OMS numbers are legit then the new management can turn things around if they take proper decisions. I hope and pray that we will come out of this situation and that we all see good days ahead.

(These are my opinions and should not be taken for buy or sell decisions)

[Logan]

@Longplay55, the funds which are buying BCG are passive funds, meaning, they are investing in BCG only because it is part of a particular index and once the company is removed from the index, they’ll start selling immediately. Don’t take this as completely positive.

We need active funds to buy BCG but at the current state, no one will be interested and it requires new management to come on board, clean up the mess etc and it’ll take time. Our first focus should be to check whether the board/management are willing to clean up the mess or are they just sleeping and not caring enough and deciding only when forced to do something or are they purposefully delaying and letting SKR control things.

As of now, it looks like it’s either the second or third and looks like a long road ahead and not a T20 match but a test match where we are put to follow on. We need a Rahul Dravid or a VVS Laxman to rescue us and get us back into the game. We have to remember that SKR is stupidly optimistic and I think he’s hoping he still can control the company. If we see the history, he’s always willing to go to courts instead of taking quick actions. Sebi should step in and should order the board to appoint new management or Sebi themselves should appoint a new board.

[Longplay55]

Logan ji,
thanks for the updates!

[Logan]

I’m not excited about the new audit firm and looks like the board has hired an auditor similar to old auditors. One thing which we can be somewhat sure is that the new auditors will be very careful because any wrongdoing will result in them losing their business and they can’t be a rubber stamp because SEBI and other authorities will be watching closely and also, the new auditors will have to engage with SEBI regularly because of the situation the company is in right now. They can miss few things but can never miss the obvious things (like things which the whole market knows or wants to know). The board should know that the auditors can quit anytime if the company doesn’t provide required information and this in turn will put more good type of pressure on the company to give proper and required information to the auditors, failing to do so can result in the the auditor giving negative comments or them resigning. So, the board/management should be very careful and not become SKR’s rubber stamp once again.

One point that I’d like to highlight and appreciate is that the independent board members (especially the women directors) are taking more responsibility than executive members like Mr.Vijay and Mr.Peshwa. When others are not taking responsibility, these members are at least taking and didn’t quit also. (I’m not sure whether it’s SKR’s remote control but if it’s not then it’s a good thing)

The structure from now on should be that there be a separate CEO and a chairman as we don’t want the situation repeating and giving one person more control (and responsibility). The board/management should also appoint a COO like other companies do, especially tech companies.
The above will bring transparency and the responsibility, and the control will be distributed. Since SKR controlled and handled everything, he took advantage and appointed whoever he wanted (like the previous auditors, CFO, board etc). It’ll cause problems to the company, employees and shareholders if a person who controls everything is fired, or if they quit etc.

The DNA of the whole company should also change, every time (whether it is SKR or the current board), they seem to take action only at the last second, or when forced to do so. They had time to share info on Q2 results but shared only at the last possible moment, same with the appointment of auditors, etc. This has to change ASAP and we should start putting pressure on them.

Regarding stock price movements or valuation, please be careful about people who try to influence others – both positive and negative. Positive people will say that everything will be alright and that the stock will go up by this much and that much and the negative people will say that it will go to single digits or will get delisted etc. No one knows what will happen and everything depends on the actions taken by the company/board and SEBI. There is disinformation on both the sides (positive and negative) – like some people said that SEBI ordered the company to appoint a Nifty 50/100 auditor. This was never the case as SEBI didn’t order BCG to appoint a statutory auditor who has audited Nifty 50/100 as SEBI only directed the company to get a peer review of its financials from a Nifty 50/100 auditor. Peer review done by an auditor and statutory auditor doing audits are different. I’m not defending the company appointing the current auditor but I’m only highlighting the obvious point which some don’t understand. Also, as everyone knows, I have always said that I wanted the company to appoint a big 4 auditor from day one. SKR never took that seriously because he couldn’t do whatever he wanted if any big 4 was appointed.

Many people think the scenario will either be this or that but actually, there are many scenarios.

– Board does nothing and will let everything get wasted and the stock crashes.

-All the revenues and profits are fake and the stock crashes.

-At least OMS and few other subsidiaries are real and the company might recover from this crisis after the board comes clean and takes decisions complying with all the regulations. The new management cleaning up the mess and looking after what’s real and making it grow.

-All the revenues and profits are real and the board takes quick decisions and appoints new management ASAP and cleans up the mess created by SKR and the company quickly and complies with all the rules and regulations.

These are only a few scenarios that might or might not happen and there are other possibilities too. All these require patience and one has to be okay with the likelihood of any of these or other scenarios happening. Buying and selling should be done either if you want or don’t want to be in those situations or after checking/consulting with SEBI and other authorities. Positive people will influence us to buy just because they have bought and negative people will influence us to sell just because they have sold. Most of them will not care whether we take good decisions or not and all they care about is their self interests. One has to have inner peace with whatever decisions he or she takes. The situation would’ve been way different if the company had debt.

One more important point is that I’m not sure why ED didn’t raid PCN and associates. They raided P Murali and Co but I’ve not seen news of ED raiding PCN. The PW fraud happened when PCN were the auditors and SEBI and other authorities should arrest PCN people for failing to check the fraud and rubber stamping everything.

Thankfully SKR did the right thing and resigned and didn’t object to SEBI’s order. Though a different case might happen in the courts, at least he took SEBI’s order and stepped down. Let SEBI and authorities decide what to do with him and other culprits. If he really cares about the company which he started, and its shareholders who have trusted him through thick and thin then he will not do anything that harms the two (or impacts the two negatively). SKR wasted a great opportunity and he’s the person responsible for that. He could’ve achieved so much in an ethical way but he chose the wrong path so he should be punished and he should live with that. He was good at many things related to technology and its trends but didn’t use it in a good way. Recently Perion started audio related ads, almost all companies are investing heavily on AI and big companies are investing in quantum technology. SKR had the knack of understanding these things well and that’s why I had respect for him but the way he lied to shareholders (and the authorities), the way he used the parent company as a thing to play with, and the backstabbing that he did to shareholders made me lose all the respect and I started hating him for causing harm to lakhs of shareholders. What makes me sad and angry at the same time is that SKR knew that all the shareholders of his company were from poor or middle class families who put their hard earned money and some have put their life savings too but he still betrayed us. He called shareholders as family many times and I just want to ask him whether he’d do the same to his family. Personally, I’d rather die than put my family (and the people who trusted me) in the position that he put shareholders in. Being in a responsible position he should’ve known the consequences of his actions. Like I’ve said before, everyone would’ve supported him if he took an ethical path but the path that he chose can never be forgiven.

[Saach]

Dear @Loan, as always, I appreciate your hard work in preparing all the facts and figures of this company. I am personally obliged and thankful to you. All the points are systematically explained in a very simple manner, which is really very useful for retail shareholders who are deeply affected. Warmest regards, dear.

[Longplay55]

@Logan….. thank you sir-ji, for in-depth and detailed update on BCG affairs…..I honestly feel its high time that, SEBI should appoint KMPs on BCG-board, so, company’s CG and day-to-day business affairs get streamlined. If it’s left to BCG’s current board, I am afraid, we will have another SKR, like the new auditor. By the way, I am heavily invested in BCG since long but NOT married to the stock, so SEBI’s decision or the Company’s decision will help me make my decision…..! Sooner the better!

[Logan]

Many people want binary solutions for everything and they expect only those scenarios to happen i.e. either boom or bust but people who understand probabilities will not have the same opinions. For positive people the stock will always reach higher value and they influence others to take decisions based on their positivity and for negative people, it’s always bust and the stock will either go to zero or end up getting delisted.

Some people say that the stock is worthless and the company has zero business and it’s value is zero but they also say that SKR is stopping the stock reach it’s true potential. If the stock is worthless and if the business is zero, how does SKR’s or other people’s actions matter? It will eventually be worthless right? Sooner or later SKR will go and the sooner that happens the better is for everyone and everything depends on the value of the business. Though the CEO/chairman post will also matter, if there’s no business then appointing a great CEO will not matter. The company/board can’t afford to make past mistakes again and if they have sense then they’ll make sure to be more serious about governance.

What we can understand from people who influence is that they recently sold most of their shares and are hell bent on creating negativity. I’m someone who doesn’t care much about these people but what I don’t like is that they will influence others to take actions just because they bought or sold. They’ll not hesitate to spread fake news. They can’t digest other people making money in a company/stock where they haven’t. This is not just for BCG but for all the stocks. You can also observe that many people will be very positive and they’ll wait for sometime and if the stock doesn’t move or if there are no developments then they’ll sell all their shares and start talking negatively. That is why I tell everyone not to trust these people (both positive and negative) and take decisions based on your study or after checking with concerned authorities like SEBI.

Like I mentioned in my previous post, there are many scenarios that may happen. If business is real (either OMS or 100%) then SKR will deliberately delay things not caring about shareholders. SKR will drag it for years as we have seen with other cases, especially the Lycos case with Daum.

Everyone treated Daum case very seriously and brought the perception that BCG will go up only if Daum case is resolved, but was that the case? I have told many times that Daum case is mostly for image purpose and not important for the business.

The recent case is not like the Daum case as there is fraud involved. This is very serious and the board/management should be more serious and they should handle things carefully. They should forget SKR and should start looking after the business and the shareholders. If the business is real then they have a very good opportunity in the market.

(These are my opinions, please don’t take these for buy or sell decisions)

[odysee]

I always read your posts and comments @Logan with a great deal of care and respect.
Along with the others on this forum, I pay a great deal of attention to the content as well as the sentiment that you convey in your writing.
Whilst I am in total agreement with your views on the negative or positive commentary that overwhelms us on the Moneycontrol or other forums, I am still unconvinced or unclear about the Board’s management capabilities or capacity. The current Board, comprising mostly the longer term independent or non-executive directors does not appear to have the bandwidth or wherewithal to manage or direct the overall business of the company which would include the overseeing of the subsidiaries which generate the bulk of the revenue and profits. Mr Peshwa Acharya , who had come on board a few years ago, and who was heading the group’s International business strategy function, is now merely a member of the Board with no executive responsibilities as per data available on the company website. I’m not sure about the zeal and effort being provided by Mr Vijay Kancharla, as he had taken a back seat despite being one the two founding members of the business.
The question then arises as to who is currently or will direct and strategise and run the business? There is no CEO in place and no CFO currently.
Is there an interim executive team in place to run the show on a daily basis? Until such time as the top management team is hired or appointed or some resolution is there to address the gaping void left in the wake of SEBI’s ruthless beheading of the company.
I raise these points not to criticise but only as a matter of practical reality in that we are expecting too much from a Board that comprises mostly of members who are not engaged in the running of the business on a full time basis.
Maybe we are now close to achieving some of the objectives that the Board had spelt out a few months ago, and the appointment of the Statutory Auditors was the first of many expected announcements. The 2nd quarter results and the peer audit review and the restatement of accounts of some prior years ( if done in compliance with the SEBI directive) as well as the Annual Return followed by the AGM are all around the corner. Add to that the CEO and CFO conundrum, and we have a rollicking next few weeks.
Time to stay grounded and with our fingers crossed.

[Logan]

@odysee, you are 100% right and I agree with you on all the points completely. I’ve highlighted these concerns in my recent posts as well.

SKR has put everyone in trouble with his reckless, selfish and stupid decisions and now it will take time to get out of the mess. It’s too much for the current independent board members to handle and to make matters worse, the executive board members are not bothered and seems don’t care for the well being of the shareholders and the company.

I’m not excepting much from the company/board, and don’t have any other choice but to be ready for both best and worst outcomes. We have only two options – one is wait till the board get the company out of the mess and the other is shareholders should get together and appoint board members who later will clean up the mess. Also, these two depend on how much of the business is real. The former will take time and the latter is very difficult to do.

BCG’s management, which was mostly SKR, is known only for talking and not taking actions. This has to change and the board should make sure not to appoint a same person for both the CEO and chairman posts. The CEO’s main task (other than running the operations) should be to take the board’s orders and the board’s only job should be to look after shareholders’ best interests.

I had great respect for SKR but he did the worst thing to shareholders and he should not get away with it. He should be sent to jail and the company should come out of his influence and not be associated with him. He may have built the company but that didn’t give him the right to play however he wanted. I still can’t digest the fact that his rich friends made hundreds of crores (maybe thousands) not even paying a single rupee and retail investors who had so much trust in him and the management became poor everyday. If the business is real then the board and we (all the shareholders) should make sure that the company is run professionally and follow each and every rule and regulation.

[vstvm]

Dear All.

Luckily BCG is retained in the MSCI global standard index Half Yearly review which is effective from 30-Nov-23

Please find the list for your review and reference.

How come it is still retained in the list.

Are they not aware of the outcome of the 2 SCN and the much awaited final report of FA.

Request fellow boarders to share some of your inputs.

Thank You.

Attachments:

1. 

   MSCI_Nov23_MSCI-GLOBAL-STANDARD-INDEXES_PublicList.pdf
   

[BBPopuri]

Any member knows the reason for today’s rally in BCG. It closed just below the UC. I feel intentionally UC is avoided towards the end.

[anand84sharma]

Total paid up capital of brightcom Group is Rs 403.70 Crore (approx 201 Crore equity share) but as per MCA data base total paidup share capital shown 242.15 Crore (approx 121 Crore share).any expert opinion about difference of paid up share capital.

[Longplay55]

It appears that MCA data base is not updated; and highest probability is that, this data is showing paid-up capital prior to 2nd bonus issue of 2:3…..!
Rest other sites are showing 404cr of equity capital. Keep your fingers crossed, by any chance if equity capital is reduced (for any unknown reasons), then it’s a big plus for valuations. Its a win-win situation.

[NIRAJ1]

Brightcom Group Ltd has filed a fresh application before the Securities Appellate Tribunal seeking a stay on the market regulator’s order restraining ace investor Shankar Sharma and others from selling shares in the digital marketing company.

The Securities and Exchange Board of India had in August restrained Brightcom’s then chairman and managing director Suresh Kumar Reddy and chief financial officer Narayan Raju from holding directorial positions following an investigation into alleged irregularities in preferential allotment of shares.

Brightcom in its petition said the allegations made in Sebi’s order were “baseless and completely unfounded”. The company added that its turnover was expected to substantially deteriorate in the September and December quarters as a result of Sebi’s actions.

“Because of the ouster of Mr Reddy (former chairman and managing director), the company has been subjected to serious problems including the problem of its very existence,” the company said in its 187-page application to SAT. Mint has seen a copy of the petition.

SAT will hear the matter on 2 January, said a counsel aware of the developments.

Brightcom Group had first approached the appeals court on 11 December challenging the market regulator’s order. Justice Tarun Agarwala, presiding officer of SAT, refused to grant interim relief to the company after hearing an appeal earlier last week.

“We have been informed that the appellants filed an application for settlement which is pending consideration. In view of the aforesaid, we are not inclined to consider the stay application at this state,” the order said last week.

The tribunal also asked Sebi to file its reply within three weeks and posted this matter for final disposal on 9 February.

The market regulator had received complaints on 6 October 2022 and on 12 May regarding preferential allotments made by Brightcom Group in the financial years 2019-20 and 2020-21.

The complaints alleged that the company had raised money through preferential issue of shares to entities that were directly or indirectly connected to it and that the money was given as loans and advances to its subsidiaries.

They also alleged that the company did not issue proper disclosures in its annual report regarding utilisation of the proceeds of these preferential issues.

Based on Sebi’s investigation, whole-time member Ashwani Bhatia in his order restrained Reddy and Raju from holding directorial positions until further notice.

A total of 25 entities and individuals were hit by Sebi’s order.

“It is due to Sebi’s August order, the company does not have any executive director/whole-time director, and on account of such vacancy the public shareholders are suffering,” said another senior counsel involved in the matter.

Brightcom Group shares are down by nearly 34% this year, and ended trading on Tuesday on NSE at ₹19.35 apiece, down 2.5%.

BRIGHTCOM GROUP
+

[vkhare789]

Any idea how can we see 187 page application to SAT? I tried to look at SAT website but couldn’t find much.

[Logan]

Is there a way to get access to that petition filed by BCG?

I seriously don’t know when this drama will end. SKR is making shareholders lives miserable and looks like he won’t learn his lessons and instead of resolving the issue, he may have other plans. It’s hard to imagine Sebi or SAT saying okay to him coming back as chairman/CEO and I’m not sure what he really wants.

(Previously SKR had said that he or anyone in the company will make sure that the company will grow no matter what but now he’s saying that the survival/existence of the company is at stake)

It’s really sad to see the current state of affairs at the company. No one is there in the top management posts and every responsibility is placed on the independent directors. SKR took our trust for granted and is killing the dreams of lakhs of shareholders who trusted him through thick and thin.

SKR, along with other main promoter, VK, made us fools and now VK is also slipping away silently when he was supposed to take more responsibilities.

I hope and pray that we come out of this mess created by SKR and see bright days ahead.

[NIRAJ1]

187 PAGE APPLICATION IS NOT AVIALBLE AS IT IS PRELIMINARY STAGE.

Attachments:

1. 

   BCG-APPLICATIONIN-SAT.pdf
   

2. 

   BCG-APPLICATIONIN-SAT.pdf1_.pdf
   

[akkithegrt]

Brightcom, in its petition, said the allegations made in Sebi’s order were “baseless and completely unfounded.”. The company added that its turnover was expected to substantially deteriorate in the September and December quarters as a result of Sebi’s actions.

SKR, once again, is playing with shareholders and creating new action dramas, which may be because of this condition.
1) Results are as per expectations,but SKR wants to show that as he is no longer in the company,results are going to be bad. Only he can handle BCG.
2) The results are really bad, and he is showing off that if he had been there in the company, it would have achieved as per forecast.

Really, as a long-term investor, it hurts.Shame on SKR for playing with retail shareholders.

[Author]

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