Questions to ask / Post-Conference Update

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  • #10945
    buffet
    Registered Boarder

    @Logan & others

    Very well articulated questions. I don’t think conf call will be more than 60 min. Hence we shall prioritize the critical questions so that at least essential questions related to PW & its status, Axis, Daum, Dividend, etc. would get answered.

    [on a lighter note] Looking at all these questions, I hope our beloved CEO wouldn’t cancel the conf call. (laugh)

    #10955
    odysee
    Registered Boarder

    @buffet, it wouldn’t surprise me if some shareholders are deliberately left out of the list of the selected lot who are invited to ask the questions and interact with SKR.
    Call me a sceptic, but there have been numerous times when despite pressing that pesky digit with great alacrity, one’s turn doesn’t come to pose pertinent questions. Or the con call is wrapped up suddenly as too much time is taken up by random (planted?) callers on irrelevant issues. No disrespect meant but as we noted in the AGM, very few meaningful questions find their place in the discourse that is too short for a quarterly interaction with the management.
    Hence, a comprehensive email with pertinent questions and queries as detailed in the preceding many posts would really be useful, provided the management chooses to address each and every matter that is causing so much distress to the retail shareholders.

    #10985
    admin
    Keymaster

    Thank you everyone for your contributions, especially Vgsatwork and Logan. More than 50 questions were posted. I have rephrased them, combined to one and listed according to a priority which I felt (sorry for that). The questions which I have skipped is due to time limitation of getting all of it answered, list getting lengthy and also some others which can be waited to be addressed in the next quarter.

    Below is the final list of questions which I will be sending now,

    Preferential Warrants
    1. What is the reason for Preferential Warrants with such a huge dilution when LOC was already in advanced stages?

    2. How are we planning to use Preferential Warrants funds – new products, acquisitions, business expansion? What would be the impact in terms of top line and bottom line?

    3. You didn’t even talk about it in the AGM. Such a big event but still nothing was discussed about that. In the AGM, many didn’t get a chance to ask queries due to technical reasons from your end.

    LOC update
    4. Last update on this topic was on 13th Nov 2020 and it said company is in advanced stages of setting up first tranche of the LOC application process. This is particularly important since while the entire ad tech industry is growing at a very healthy pace of 20%+, BCG’s top line growth is flat for the last 3 years and there has been no attempt from the management side to address the top line growth issue and based on earlier updates, the impeding factor seems to be capital.

    Axis update
    5. On 13th Aug 2020 an update was provided through stock exchanges which in essence stated that BCG has sent a formal proposal to Axis and awaiting response from Axis Bank. We have recently seen an update on 15th Feb 2021, which is stating pretty much the same thing after 6 months and the matter still is in NCLT court. Why is the company not closing this issue when the preferential issue was being raised with the stated objective of closing existing debts?

    6. There have been reports from the NCLT hearing that AXIS bank has blocked this preferential issue money citing the fund that they are being owed? Why is there no update to the shareholders from the company to clarify on this? The case being in NCLT is causing lot of uncertainty.

    7. What is the settlement amount proposed to Axis and timeline? Which segments of business will be impacted by this payment or by delay in the settlement

    Daum Settlement
    8. What is the latest on this? When can we expect a closure?

    Consolidation of subsidiaries into one entity
    9. Update on the same was provided to exchanges last in Feb 2020. What is the latest update on this? When would the new entity be created?

    10. BDO Audit – Last update on this topic was in June 2020 saying that audit was in progress. What is happening on this? Would this audit report be made available to the shareholders? If not, with whom such a report would be shared with?

    Quarterly Results
    11. Given the elections and covid season, why there was not much growth in sales and profits. December quarter is usually the best quarter for BCG but this time there’s no growth in revenues or profits when we compare results Y-O-Y. Many adtech companies, including bigger companies like Google and Facebook have had greater growth rates in the December quarter.

    12. We would appreciate if the company provides revenue break-up of SSP, DSP, DMP and CTV businesses.

    13. Can the management confirm that the books of account and the results confirmed by our Board of Directors, of each and every subsidiary , are audited by their local auditors in compliance with the local laws and regulations prevailing in those countries?

    14. Last year other receivables were 530crs and this year they are 150crs. What are these and how are we supposed to know what these are? Nothing about this is mentioned in the Annual Report.

    Investor meet update

    15. Last update on this topic was in early June. No further update in terms of whether or not the investor meet happened and to which investor groups these presentation were being made? Till date, we do not see any institutional shareholding in BCG. Is it because investors are concerned about pending legal issues? What is management’s plan to address this?

    16. There’s so much manipulation going on with the company’s shares. Operators are controlling everything. What measures are you taking to handle this issue? When asked about this the last time, you said you have arranged stable investors to buy shares. What’s the progress on that?

    Investors’ Exits
    17. Many investors who held significant quantity have completely sold their shares and this raises many questions/suspicions/doubts. We know this involves other parties but giving clarity on this will be appreciated by all the shareholders. There’s so much talk going on about this in the market and giving clarity will clear all the confusions that shareholders/potential investors have.

    18. The Goenka Group, which held significant quantity in the company, have sold all their shares in just one quarter. What’s the reason for this? Their selling raises many suspicions like – they held their shares till the PW got approved and exited soon afterwards.

    Corporate Governance/Market/Dividends
    19. Some of us still haven’t received dividends from the company. We send mails to the IR Department, asking them about the dividends, they won’t reply to us. If we ask Aarthi Consultants, they say that the company has not communicated with them regarding dividends. Whom should we contact to get even basic information? Its not how much dividend amount we are getting but its about the company’s commitment and transparency.

    20. The market perception/sentiment towards the company is very poor/negative. Your actions aren’t helping it get any better. For eg – you decided to do a massive dilution but didn’t inform the shareholders as to why you’re doing that. You announced dividends more than 6 months back and you had all the time to sort out any issue with the payment but still you delayed the payment (and still haven’t paid to many investors). You said you have arranged buyers for OAK’s shares but they decided to dump their shares. How are we supposed to trust what you say when you have always ignored/neglected shareholders?

    #11935
    hw_tw
    Registered Boarder

    Any idea on con call schedule

    Are we preparing any questions list this time too

    #11940
    Logan
    Registered Boarder

    @hw_tw, please check yesterday’s press release for conference call schedule. It’s this Saturday at 3pm. This time the duration should be for 1 hour at least. There’s so much to ask and 45 minutes won’t be enough. We all should send mails to them asking them to increase the duration of the call.

    I’m preparing the questions list and will share it with everyone before Thursday EOD.

    #11950
    Rishi_life
    Registered Boarder

    @logan please share your question…I will also raise the same and email it to company so that we can get our answers…

    #11960
    Logan
    Registered Boarder

    @Admin, these are my queries. Please review them once and mail them to the IR department.

    To the CFO

    1) What constitutes other income of Rs.18.92crs for this quarter?

    2) What are other receivables mentioned in the balance sheet? Are these receivables different from account receivables? For FY20 the amount was Rs.150crs and for FY19 it was Rs.530crs.

    3) In the non-current assets – loans are 97crs, other financial assets are 14.5crs. In the current assets – loans are 728crs, other current assets are 170crs. Under current liabilities – other current liabilities are 227crs. There’s no proper information on these items in the balance sheet of the annual report also. In the notes section you have just mentioned these items as “Other”. It would help everyone if you could provide proper details of these items in the notes section.

    We have requested the company several times to provide complete details of these items in the annual report but you haven’t taken our request seriously. It is very difficult for new investors to understand what these items are. We would really appreciate if you could provide proper details in this year’s annual report.

    To the CEO

    1) Congratulations on a great quarter. Can this growth rate be maintained in the coming quarters?

    2) What is the update on LOC? Is it put on hold?

    3) Privacy concerns related to Online Advertising is a hot topic these days. How does it impact BCG’s business going forward?

    4) What is the impact of Apple changing its privacy policy (on BCG’s business)?

    5) Google has announced that it would phase out third-party cookies on Chrome in the coming years. How does it affect BCG and how reliant is BCG on third-party cookies?

    6) How big is BCG’s CTV business? Are there plans to grow the CTV business big or are you taking a conservative approach? Recently Magnite Inc bought SpotX to grow the CTV business. Do you have similar plans?

    7) How will you utilize the PW and PO funds?

    8) When are you planning to start the audio ad business?

    9) We appreciate the issuance of bonus shares but we have a concern too. Because of the bonus shares (and PW shares), the free float will increase and more importantly, the EPS will come down (below 5). What are your thoughts on this?

    10) Are there plans to revive the parent company’s business (standalone)? And when will you start scaling up the adtech business in India and other Asian countries?

    11) Because of the PW issuance, the holding of the promoters will reduce by almost half of what it is now. Are all promoters okay with that reduction?

    12) Many shareholders still haven’t received their dividends yet. What’s the reason for this?

    13) Still there’s no improvement in communication with investors (wrt investor relations). You said it’d be improved by now but that has not happened. Why is it taking so much time?

    14) Update on Lycos-DAUM issue.

    #11963
    admin
    Keymaster

    @Logan – Thanks so much. I have sent the questions to IR.

    #11968
    Rishi_life
    Registered Boarder

    @Logan…. I too shared these questions to BCG IR team..

    #11979

    @ Logan Sir,very well framed questionnaire. I for one think that if we get LOC at this juncture, It will help the company immensely. Funds hai to Dhanda hai, Nahi to manda. I wish & Pray that our company gets the LOC at the earliest.

    Request you to give your inputs after the concall is over. Thank You.

    #11983
    admin
    Keymaster

    @Logan Sir, most of questions that you beautifully framed were taken in the call. Thanks so much for your contributions and continued support 🙏.

    #11984

    Adminji, Pls can you post the highlights of today’s concall. Thanks in advance.

    #11985
    admin
    Keymaster

    @kris – There is no better thing than to hear it straight from the voice of our vibrant CEO and feel the vibe.

    If someone posts it on YouTube we can share that here.

    Having said that I will try to post the highlights. I would request Logan, DH and other seniors to share their post conference update if any.

    #11986
    nitin_asce
    Registered Boarder

    I attended the concall. SKR was brimming with confidence and I could sense that a well laid plan is already in place. The highlight of the call is when being asked on nasdaq listing, Mr SKR mentioned that he meant that only when he replied to last question. To the last question he replied that there may be some dilution at subsidiary level by diluting the stakes (my interpretation on answer provided by CEO).

    I am very excited from today’s call. Would wait for posts and reviews of today’s call from senior boarders.

    #11987
    admin
    Keymaster

    Sharing some of the update from Investors Conference Call – July 03 2021

    About Results & Sustainability
    Spectacular march end results. One thing which some investors may have missed is on comparing with last year same quarter, the revenue has grown 11% and profits grown by 30%. This is due to great job by the sales team by bringing business and the operations team have done phenomenal job by optimizing profit. Partly also due to debt reduction. Going forward would like to do the things in same way in optimizing profit.

    “BCG Family”
    We are seeing continuous growth in the BCG family, the investor count reaching closer to 80000 mark at the end of June.

    History & The Future (For the knowledge of new family members)
    Briefly touched upon the history of the company from the time of USA Greetings till where we are now. From 2010 to 2014, we have grown the business from $10 million to $100 million. We are at about similar phase today, for the next leg of growth. $390 million business currently, 14 subsidiaries, 40 countries, 60-70 billion impressions per month.

    Questions received by email
    1. Can this growth rate be maintained in the coming quarters?
    Definitely will be looking for similar growth rate. Industry growth is also there and will be focusing on improving efficiency on sales and operation to continue this kind of growth rate. All the ducks have been lined up.

    2. LOC (line of credit) Status
    Very cashflow required kind of business and LOC will be required at some point of time. Almost signed in January last year but felt the terms could have been better. So had to step back, to fix few of the things, to make the company better valued as a business in order to get a better terms. That was the reason to postpone the LOC, will be revisiting within 2 quarters time.

    3. Privacy concerns (google/apple privacy policy, cookies, etc.)
    A hot topic which we have always been extremely careful about. We expected this early while dealing with publishers data and also when building better tech platforms. Protector product is one such. Other initiatives will also be announced later. All these concerns are well addressed.

    4. Bonus shares
    Postal ballot will be send to shareholders by next week for resolutions on – bonus shares, increasing authorized capital, capital clause , raising of funds). Meanwhile will apply for requisite approval from stock exchanges.

    Record date of bonus issue should be between August 2nd week (i.e. after postal ballot results are out, board members meet will decide the record date). Issuance of bonus shares will be on or before August 27th 2021.

    The intent of bonus shares issuance is to give back the investors who have remained through this period.

    Though the EPS will drop post bonus issuance, the board believes this was a positive move considering many things – there is increase in PE multiples, market cap etc.

    5. Standalone performance
    Have few ideas to improve standalone business from this year itself – both organic and inorganic.

    6. Investor Relation Issue (Calls/mails not getting answered)
    Have improved in this front despite challenges due to pandemic situation but there is more improvement to be done, plan to set dedicated team. In terms of communicating with investor community there has been significant improvement.

    7. Lycos Daum
    As mentioned in the previous call, it is verbally settled , done and dusted. Very close to get the payment done, will be announced when it happens.

    8. Connected TV
    Already there in the ecosystem, business is growing.

    9. Digital Audio
    A new opportunity for us to explore, a lot of advertisers are looking for it. Traffic is there but publishers not able to connect the traffic. Recent webinar went very well and publishers are looking on to that.

    In negotiation with a company in this space for acquisition and will be shared once there is some development.

    Q&A with callers
    – Domestic digital market is a tough area to crack. When there is scope for profitability we will definitely enter into it.

    – After crossing $450 million revenues, digital marketing companies starts to get free cash flows. Until that it goes through product development and additionally we also had debt repayment to make.

    – Initially we may do fund raise at the parent level but the eventual game plan is to consolidate some of the large subsidiaries together and list it. That funds can be used for acquisitions without diluting any further at the parent level.

    – Have shifted our focus to get parent the right value recognition first, before getting the LOC, consolidation of the subsidiaries and its listing.

    #11988

    @ Adminji. That means CI Sir has evaluated that with time our company Promoter will list on Nasdaq. CI Sir is seldom wrong on his assessments. All said & Done good news for one & All. 3 Cheers !!!

    #11990
    admin
    Keymaster

    https://www.ndtv.com/video/business/news/lycos-internet-on-q1-earnings-378722

    Please watch this Lycos Internet interview of 2015, in which Mr.Suresh Reddy shares with Prashant of NDTV Profit, his vision of overseas listing (@9.55 mins).

    Unfortunately due to the international litigation with Daum, parent debt and other issues, it was put on the back burner. The global consolidation plans (organizational restructuring) unveiled in 2020 was always understood as the step towards this direction and we had discussed this many times. For instance this post by DH on Feb 2020

    #12030
    jmathew
    Registered Boarder

    Investors, I just want to bring your kind attention to, few points from the conference call. I may be wrong so please do your research.
    1. Please try to listen to the cc completely and try to connect all the dots.
    2. SKR want to revisit for LOC after a quarter or two and before that, he is eyeing a good valuation
    3. LOC will add another 30 % growth
    4. SKR want a good valuation for the company before consolidating a few subsidiaries and QIP
    5. He is looking for a sales target of $ 450 Million plus asap which will add more cash flow.
    6. Few acquisitions are expected in the coming quarters.
    7. He is looking for a famous J curve too (many after a couple of years)
    As per my view, a minimum decent pe after bonus issues and PW dilution are around 20 (current sector pe is 34). Timeline – I expect pe 20 by end of this year. Best wishes to all the BCG investors.

    #12093
    jmathew
    Registered Boarder

    With the new acquisition bcg is meeting may points mentioned above. Now we are looking for higher growth and higher eps in coming quarters.cheers and sit and enjoy the ride.

    #12124
    jmathew
    Registered Boarder

    Total equity after bonus + warrants+ new issue of 12 cr shares = 116 cr.
    Looking forward diluted eps will be around rs 5 from the existing business plus earning from the new acquisition. We can very much expect loc by end of this year which will add another 30 % . Few more acquisitions are expected plus new businesss
    I belive we are on the way to non stop rs 100 plus, even all time high.
    Average industry pe is 34 and I won’t be surprised if bcg move to pe 40 plus non stop.
    Enjoy the ride

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