Questions to ask / Post-Conference Update

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  • #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

    #12029
    jay69
    Registered Boarder

    The complete audio of the latest concall conducted by BCG’s management held on 3rd July 2021 (Audio very clear from around 12 minutes)

    #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

    #12461
    Logan
    Registered Boarder

    @Admin, these are my queries, please review them once and send them to the IR.

    1) Thank you for taking investor friendly initiatives like bonus, dividends, ESOP etc, and thank you for improving communications with investors. These are making value realization to happen. Our only concern is the stability of stock prices. Since the free float is high, it is easy for operators to manipulate the prices. We understand that price movements are not in your control but we just wanted to share our concerns with you.

    2) Do you have plans to meet with investors, institutions (and analysts) who can buy shares from the open market? This will bring stability to stock prices.

    3) After your comments in the last conference call we were hoping/expecting to see better results this quarter. Usually BCG will have good 1st quarter but this time it was not that good compared to last year’s Q1 results (where we had growth of more than 20%). What are your thoughts on this? We understand it’s because of liquidity issues so should we expect higher growth rates only after you get additional funds or can we expect good growth rates without the funds (like in Q4)?

    4) What is the update on the acquisition news? When do you expect the transaction to be completed? Is it possible to reveal the name of the target company? If possible can you give more details about the target company?

    5) Update on audio ad related company acquisition?

    6) What is the update on Line of Credit (LOC) that you are seeking?

    7) What is the update on pledged shares? You said that the promoter group will get back their shares once Axis bank debt is paid but as of now 18% of the promoters’ shares are still pledged. There’s a reduction in the number but we were expecting it to be zero by now.

    8) When can we expect promoters to buy shares from the open market? Promoters increasing their stakes will bring confidence to investors and allay any concerns because of the dilution post warrant conversion.

    9) Update on Lycos-DAUM? Is it possible to reveal the settlement amount?

    10) Since the economies are starting to re-open, everyone is worried about 2 things – the next covid wave and inflation. How do these two things affect BCG’s business? Will there be any write-offs or impairment because of covid?

    11) How big is BCG’s CTV business? What percentage of revenue is from CTV business?

    12) Update on B-Local exchange. How much revenue do you expect from this in the short and long terms?

    13) Jio (Reliance), Flipkart, Airtel all have plans to start their own ad-tech business. How do these developments affect BCG’s plan to grow the business in India?

    14) Update on AI and ML?

    15) When can we expect this year’s annual report and the AGM?

    16) Many less informed people in the market still don’t understand the business of BCG properly and they compare it with random IT and software companies. They don’t understand the importance of investing heavily in technology too.

    You have shared so many useful documents with the investor community about the business but many ignorant people won’t go through those properly and they spread fake information about the company. So to change this (to some extent at least) can you please provide more details about the company in the parent company’s website (on the website not in documents as there are documents already in the investor section). Details like the company’s history, the acquisitions you’ve made, different types of businesses the company does (more emphasis on ad-tech business) and links to subsidiaries’ websites. Also please make this year’s annual report is as informative as possible and please make sure that you give detailed explanation of different items of the balance sheet in the footnotes (items like other assets, loans and advances, other receivables etc)

    #12463
    Brightspot
    Registered Boarder

    Price stability is very important otherwise long term investors will only be looking at price fluctuating up and down without booking profit..after bonus issue buying interest should go up , we should be definitely discussing this with Suresh kumar today..share price coming down with pathetic volume is not looking good at the moment..however I’m still bullish on the scrip

    5+
    #12464
    admin
    Keymaster

    @Logan – Thanks for the questions. I have mailed it to IR.

    #12853
    hw_tw
    Registered Boarder

    First of all thanks SKR garu for giving the guidance numbers and achieving the targets as per the guidance numbers given that it was the first time and also especially when other companies were finding it difficult given the dynamic nature of the adtech industry.

    Thanks for the all progress… in terms of additions to leadership team, FPIs and Mr. Shankar Sharma as Investors, time to time market updates, ESOP trust formation, Pledge reduction and the price growth we have seen in the last quarter.

    Congratulations for being included in MSCI India Smallcap Index.

    After looking at the numbers thought I have nothing to ask, but reminded myself that conviction is important for each and every investor and it can’t be just me or few other investors in this or other groups. We need conviction from majority. This is definitely improving since last few quarters with time to time dose of knowledge from knowledgeable people across this board and other boards. Conviction increases tremendously and stays for long when we hear something directly from the management in the Concalls and from company updates.

    Given this context, here is the list of few questions from my side.

    Please note, I haven’t touched upon Daum / Lycos, Receivables, CS appointment, Pledge shares, Dividend, AGM etc;


    @admin
    – Please see whatever you feel are important ones to share to the management

    On Financials and the market
    – Any change in the guidance numbers for the next two quarters.

    – For the current quarter since we are half way through, what is the run rate you are seeing and if there is any revision

    – There is a mention of 250cr CF in Q1FY22. Could you provide revenue and PAT guidance for this quarter too

    – Can we get a breakup of growth figures from Brightcom, Compass, Protector and BLocal business

    – Are we planning to launch BLocal in any other countries

    – What were the key drivers of revenue growth, can we attribute this to increased number of impressions or increased cost per impression or Google MCM partnership or something else

    – We have seen a dip in AdAuth figures from around 52K publishers to around 47K, thought this has not impacted revenues. Any specific reason for this drop, can we see this increasing in future and most importantly how much we attribute this to BCG’s revenue

    – It’s mentioned that we are clocking around 60 billion impressions per month. What’s the growth rate of this number compared to last year. If possible, could you please publish this number along with publishers, agencies count on quarterly basis

    On partnerships
    – How much percentage of revenue we are clocking from Google MCM partnership. Do we see more players becoming MCM partners in future and if there is any impact, how are we planning to mitigate this

    – Like in the past are we targeting any country specific exclusive partnerships with players like FB, Microsoft or in Audio ad space like with Spotify or other players

    On Acquisitions
    – Any update on Indian DM company due diligence. What’s the outcome, are we going ahead if so, will it be possible to reveal the name of the company and tentative timeline.

    – Any update on growth of this company in terms of employee count

    – In general the IT Industry is facing challenges like Attrition (the Great Resignation), increased Salaries, Travel restrictions etc;. Are we seeing any similar challenges within BCG or with the target DM company

    – Given that audio Adtech is evolving industry both in terms of technology and market, what kind of acquisition we are targeting at. Will this be a pure product company with smaller team or a service provider or a combination of both

    What would be the size of Audio Adtech companies we are in discussion with both in terms of team size and revenues

    What kind of valuations we are looking at. Given that BCG’s valuations are still low compared to other Adtech companies and given that there will definitely be a difference with the target DM or the Audio Adtech company. Any valuation higher than BCG’s current valuation might have a impact from the market. How do we plan to address this as the growth rates of the target company and the value addition which it brings on table for BCG can’t be quantified.

    Are we looking at multiple acquisitions in Audio Adtech space

    Will Satish Cheeti will be operating this division from India or he will be sitting in US close to customers.

    Will the backend operations will be taken care by the existing team or the new DM company’s team or are we looking to form a new implementation team either in India or in other countries

    Do we have any existing customers whom we can target for Audio ads or it’s a completely new set of customers

    What will be the target revenues we can expect from this segment in this FY and for the next FY.

    Assuming the target companies will be smaller in size operating in a single country, can we expect this due diligence process will be done quickly with internal team and any timelines for the first acquisition

    What will be source of funding for this acquisition and will there be any equity dilution at the subsidiary level or will it be from the cash flows generated internally

    LoC
    – Will there be any change in plan on LoC process which was on hold temporarily. Does the positive CFs have any bearing on this decision

    Nasdaq listing
    – Last time you had mentioned that we need to get the right valuations in Indian market before we look at Nasdaq listing. Sorry for my poor memory and laziness, is this for LoC?. Anyway, as I understand from fellow knowledgeable investors that we match all the criteria for Nasdaq listing. Do you feel that this is the right time both in terms of timing and given the bucket list of to-dos on our side or we have to wait for it. Any updates on this front.

    MSCI Smallcap Index Inclusion
    – What will be the effect of this inclusion in terms of fund inflows. Do we expect any MFs entering.

    ESOP
    – Are there any shares accumulated as of date, is this planned for this or next FY

    On future business
    – Given that there are other forms of asset / content monitization models … like subscriptions, NFTs etc; do we have any plans to enter this space or go deep in Adtech space itself

    – We are seeing from other listed Adtech company like Affle that there is also a good market scope for Cost Per Customer Acquisition model at least in India. Do we see similar scope in US or any other country and any plans to get into this space either with in-house technology or a new acquisition

    – Given that we are strong on SSP side, does it make sense to also enter into DSP side too with in-house product and provide end to end capabilities to customers across

    #12854
    Investor_2022
    Registered Boarder

    Dear hw_tw, thank you for sending the questions.
    I have passed it to ir@brightcomgroup.com

    #12858
    Logan
    Registered Boarder

    @hw_tw, thank you for taking the time and effort in preparing these excellent questions. You have covered every topic perfectly.


    @admin
    , this is my list of questions. I have left out the ones which are similar to @hw_tw’s.

    To the CEO,

    Congratulations on a great quarter. On behalf of all the shareholders we would like to thank you for all your efforts, and for taking good decisions (even during tough times) that benefited all the stakeholders and also for answering all our queries with patience and for conducting conference calls every quarter without fail. We always look forward to these calls as we get more confidence after listening to you speak.

    Queries

    -Can you talk about India’s ad-tech/online advertising market. We don’t have much information about the market as it is not well covered like in the US. We wanted to know how different it is from other markets (like US, Europe, LatAm, China etc).

    -Now that there’s growth in the business without additional funds, do you see the necessity of an LOC?

    -Do you expect Android to make similar changes to its privacy policy like Apple/iOS did?

    -What’s the impact of global supply chain issues on BCG (and it’s subsidiaries)? Does it lead to a cut in ad-budget by advertisers?

    -Do you have plans to acquire a CTV ad company?

    -What headwinds do you see for ad-tech companies in the future?

    -Annual Report and AGM updates

    #12859
    odysee
    Registered Boarder

    Excellent depth and breadth in the questions compiled by @hw_tw and @Logan for the conference call.
    My compliments.
    The rest of us are spared from exercising our brain cells now.

    #12861
    admin
    Keymaster

    Thanks @hw_tw and @Logan for preparing the questions. I will be sending to IR before Wednesday EOD.

    #12866
    admin
    Keymaster

    I have sent the below set of questions to IR. Thanks again to @hw_tw and Logan.

    On Financials and the market
    – Any change in the guidance numbers for the next two quarters.

    – For the current quarter since we are half way through, what is the run rate you are seeing and if there is any revision

    – There is a mention of 250cr CF in Q1FY22. Could you provide revenue and PAT guidance for this quarter too

    – Can we get a breakup of growth figures from Brightcom, Compass, Protector and BLocal business

    – What were the key drivers of revenue growth, can we attribute this to increased number of impressions or increased cost per impression or Google MCM partnership or something else

    – It’s mentioned that we are clocking around 60 billion impressions per month. What’s the growth rate of this number compared to last year. If possible, could you please publish this number along with publishers, agencies count on quarterly basis

    – We have seen a dip in AdAuth figures from around 52K publishers to around 47K, thought this has not impacted revenues. Any specific reason for this drop, can we see this increasing in future and most importantly how much we attribute this to BCG’s revenue

    – Are we planning to launch BLocal in any other countries

    On partnerships
    – How much percentage of revenue we are clocking from Google MCM partnership. Do we see more players becoming MCM partners in future and if there is any impact, how are we planning to mitigate this

    – Like in the past are we targeting any country specific exclusive partnerships with players like FB, Microsoft or in Audio ad space like with Spotify or other players

    On Acquisitions
    – Any update on Indian DM company due diligence. What’s the outcome, are we going ahead if so, will it be possible to reveal the name of the company and tentative timeline.

    – Any update on growth of this company in terms of employee count

    – In general the IT Industry is facing challenges like Attrition (the Great Resignation), increased Salaries, Travel restrictions etc. Are we seeing any similar challenges within BCG or with the target DM company

    – Given that audio Adtech is an evolving industry both in terms of technology and market, what kind of acquisition we are targeting at. Will this be a pure product company with smaller team or a service provider or a combination of both

    – What would be the size of Audio Adtech companies we are in discussion with both in terms of team size and revenues

    – What kind of valuations we are looking at. Given that BCG’s valuations are still low compared to other Adtech companies and given that there will definitely be a difference with the target DM or the Audio Adtech company. Any valuation higher than BCG’s current valuation might have an impact from the market. How do we plan to address this as the growth rates of the target company and the value addition which it brings on table for BCG can’t be quantified.

    – Are we looking at multiple acquisitions in Audio Adtech space

    – Will Mr. Satish Cheeti be operating this division from India or he will be sitting in the US close to customers.

    – What will be the target revenues we can expect from this segment in this FY and for the next FY.

    – What will be source of funding for this acquisition and will there be any equity dilution at the subsidiary level or will it be from the cash flows generated internally

    – Do you have plans to acquire a CTV ad company?

    LOC

    – Now that there’s growth in the business without additional funds, do you see the necessity of an LOC?

    Nasdaq listing
    – Last time you had mentioned that we need to get the right valuations in the Indian market before we look at Nasdaq listing. I understand from fellow knowledgeable investors that we match all the criteria for Nasdaq listing. Do you feel that this is the right time both in terms of timing and given the bucket list of to-dos on our side or we have to wait for it. Any updates on this front.

    MSCI Smallcap Index Inclusion
    – What will be the effect of this inclusion in terms of fund inflows. Do we expect any MFs entering.

    ESOP
    – Are there any shares accumulated as of date, is this planned for this or next FY

    Other queries

    – Given that there are other forms of asset / content monetization models … like subscriptions, NFTs etc; do we have any plans to enter this space or go deep in Adtech space itself

    – We are seeing from other listed Adtech company like Affle that there is also a good market scope for Cost Per Customer Acquisition model at least in India. Do we see similar scope in US or any other country and any plans to get into this space either with in-house technology or a new acquisition

    – Given that we are strong on SSP side, does it make sense to also enter into DSP side too with in-house product and provide end to end capabilities to customers across

    – Do you expect Android to make similar changes to its privacy policy like Apple/iOS did?

    – What’s the impact of global supply chain issues on BCG (and it’s subsidiaries)? Does it lead to a cut in ad-budget by advertisers?

    – What headwinds do you see for ad-tech companies in the future?

    – Annual Report and AGM updates

    #12870
    hw_tw
    Registered Boarder

    Thanks @admin and @Logan

    Hope SKR is going to cover most of these questions and most importantly hoping SKR is going to give some positive news on the acquisition front or other things like he did last time with the guidance numbers.

    #12882
    admin
    Keymaster

    The CEO reiterated that the focus is on growth – ROE and FCF which is what matters most to the shareholders. I remember in one of the conference call, one caller casted doubt that enough is not being done to improve the share performance and suggested few things (like inviting MFs) which did not go down well with CEO and that was the only time I felt CEO to be little annoyed. In hindsight, the evidence of meticulous planning of years is visibly clear, paving the way to improve the shareholders wealth in the most rewarding manner and those who kept faith and patience are reaping all the gains.

    Requesting Logan, HW_TW, Odysee and all others to share your thoughts on today’s call.

    #12883
    odysee
    Registered Boarder

    You’ve nailed it @ Admin.
    The focus is clearly Return on Equity and Free Cash Flow.
    By re-emphasising on these a couple times, enhancement of shareholder value is very much a priority for Mr Reddy and his core team.
    I was particularly impressed by Mr Reddy’s clear minded and precise articulation on queries and matters relating to the proposed acquisition where due diligence is now complete but the next stage is in play, as well as the active search and pursuit of an Audio Ad-tech company/companies in the U.S.
    The understanding that the existing and new business opportunities are providing such exciting opportunities for BCG, are a clear indication of phenomenal growth and performance in the foreseeable future.
    The strategy developed by the management team and the precise execution thereof in recent quarters, is remarkable and the results are there for all to see, cherish and applaud.
    We should never lose sight of the fact the the heavy lifting and incredibly hard work is done by the visionary and indefatigable Mr Reddy , ably supported by his very talented colleagues at all levels of the Organization.
    We retail investors are along for the ride-and what a ride it has been.
    But then this ride may not have possible for many of us if not for this forum and your bringing on board incredible motivators like @Logan and @hw_tw and others.
    The path ahead for BCG has been pretty much laid out by Nr Reddy, and today’s reaffirmation of the revenue and profit guidance provided in August as well as articulation of business plans provide a tremendous sense of confidence to the existing and prospective stakeholders in the company.

    #12885
    JackSparrow13
    Registered Boarder

    Happy post listening to the Concall. The investor questions were pretty pointed and hard hitting (from Daum resolution, importance of lycos, low dividends, promoter shareholding “falling” over 2 quarters, status on both India & US acquisition, why they were taking “so long” Auditor qualifications over overseas revenue, why no concall notes from 2016, even why preference shares were raised at low price, priority between organic & inorganic growth, further dilution, attrition, impact if Android applies privacy rules like Apple, impact of Googles rules,as well as suggestions like splitting the total sales by different businesses). The management response were pretty realistic, I felt. Corporate world does not run as fast as an investor’s imagination, unfortunately. Need to give management at least 3 years, to achieve the ambitions they are currently articulating. But, atleast Suresh Reddy has clear ambitions of growth, improvement of ROE & FCF. Patience is needed here, in spite of prices wildly rising.

    #12890
    hw_tw
    Registered Boarder

    Thanks SKR garu for covering most of our questions.

    Thanks @Jay69 for sharing the updates.

    Sorry @admin, @odysee for delayed response. It generally takes time for me to collect these thoughts. Anyway, I am sharing these thoughts below

    – Overall the Organic growth is intact and there are no headwinds or risks coming from MCM partnership, Privacy policy changes or the general attrition in the tech industry.

    – With high focus on ROE and FCF, SKR seems to be targeting FIIs / DIIs analyst community. I guess SS factor seems to be working behind the scenes, who else will know better than SS on what markets wants.

    – Some tough talk on the dividend. Totally agree that the cash is best utilized for the growth of the company and thus increasing share value. Investors who understand the math will be happy that eventually they are getting multiple times return per share compared to partly dividend. Happy that our thoughts are matching, he took a similar metaphor of what I had shared in TG channel. Will post this separately

    – The FCF generated is going to help sustain growth next year too without any external funds. This is unlike previous years where the company had to let go off some opportunities and was desperately in want of cash

    – Growth is going to be fuelled further with inorganic portion. Excited about the higher margins of Audio ad space.

    – Operational efficiencies, adding new agencies and reducing tax should add to the growth.

    – Would be happy to hear the announcements related to the technology additions they are doing to the their product stack

    – One caller has asked for a detailed breakdown of the numbers and SKR has agreed to share this from next to next quarter onwards. This is also my request and I would request SKR if possible to please share it as a seperate investor presentation for the current quarter itself. I feel this is very important information from the FII/DII investment point of view especially given that BCG is included in MSCI Smallcap Index and there are high chances of these investors wanting to enter BCG. To my understanding, before they take a Buy call the Analysts of these organisations would need to prepare a detailed report by slicing and dicing these numbers and this detailed breakdown would be helpful for them.

    – Some time is spent on questions related to promoter’s stake, pledge percentage, con call recordings etc;. This might look like basic questions for some old investors in stock market or old BCG investors, anyway it is good that people have heard it from SKR himself and would feel confident and build conviction.

    Coming on to some of the important questions he has addressed and my view points about these answers

    Guidance Figures
    Numbers intact. As we have seen in the current quarter they were able to match both topline and bottom line. This indicates that the company is into long term contracts and there is a high percentage of certainity in their CPM model unlike the performance driven business models like CPCA where there is lot of uncertainty both on no.of ads to run to acquire a customer and no. of customers they will be acquiring eventually and given that the overall campaign budgets are fixed and bit the other way round.

    Also the new filtering technology seems to giving more clarity on their final real traffic excluding bot generated spurious traffic and thus more clarity and confidence on guidance numbers

    AdAuth
    Agree that this is not the right metric to look at (as @Logan keeps stressing on this point) though it gives some what high picture. The real metric is no. of ads which each of these publisher is showing.

    Happy about around 100% growth in ad impressions to 60 to 70 billion compared to 30-40 billion range. Request SKR to continue publishing these metrics on quarterly basis.

    One more point, I am not sure how much percentage of this 70 billion traffic passes through BCG’s products (Brightcom, Compass etc;). Handling this much of traffic is not a small feat and shows the strength of BCG’s product Architecture / tech stack. We all know an ad is served within few milliseconds when a web page is loaded. This only shows how strong their tech team is behind the scenes and how hard they are working. I am sure this info would give confidence to both the tech investors as well as to the analysts. Request SKR to please include this info in whatever way possible in future presentations.

    Google MCM partnership
    – Nice to know that these numbers are not yet come in. This also indicates that they are not heavily dependent on this partnership. Looks like they are migrating existing customers to this model and new business arriving from this partnership might not be that significant as popularly believed by most of us and and market participants. I felt this partnership though good at this stage might turn risky if tomorrow Google changes their business model or if new players become MCM partners. Happy to know that this doesn’t seem to be the case.

    Leadership team
    It is getting expanded with more people joining the foreign team.

    As discussed before, with increasing size BCG would be in need of more hands to run the show effectively. Nice to see this happening with more people getting added in other geographies to along with PA and SC.

    FCF
    He has mentioned in many calls before that we will be able to generate FCF once we cross certain numbers. I was little bit concerned that this goal post is getting shifted and was sceptical that this might still not happen when we actually cross the threshold figure or thought this number might not be significant enough. With 250cr. Minimum CF each quarter all my concerns were put to rest permanently. The should help the company to focus on both organic and inorganic growth without worrying about the funds

    Acquisition of DM company
    – Good to know that DD is complete and it is moving forward.

    SPA stage also means most likely there is a broad agreement on the final purchase price and it is the nuances of payment terms and conditions and other things, which needs to be finalized. Hoping that the SPA is finalized soon and agreed by both the parties.

    Having gone through SPA process myself, I can tell you that this step is very important and sometimes takes time. SPA has two parts to it in terms of acceptance. The terms and conditions has to be agreed by the stakeholders (Founders, Promoters, Other Shareholders) in parallel to the Legal team. Generally the SPA doc goes into multiple versions as the discussions progress.

    It is not clear at this stage whether it is in the hands of Stakeholders or Legal team though SKR kind of mentioned that it is in the hands of legal team. In case of later we can assume that the the deal is through and it is just a matter of time for the legal team to agree upon. In case of former, there are still chances of deal falling apart or getting further delayed.

    SKR was not as excited as he was last time talking about the growth of this DM company, but this is totally understandable given the current stage of the deal. Also given the high emphasis on ROE, there could be chances that this factor might be playing on back of SKRs mind. Hoping the deal get through soon and excited to see these two companies and the team work together for a larger goal.

    We also need to understand that the deal can happen only in the best interest of both the parties. If something has to be negotiated they better do it now and not after acquisition. Post acquisition nobody would be happy sitting across table discussing SPA clauses instead of business. As an investor we should support whichever way it goes through and doesn’t get emotionally attached to it.

    Audio Ad tech acquisition
    With SC focusing totally on this, expecting to hear an LoI news probably this quarter or max by next quarter. SKR is clear to get an early mover advantage, but with evolving technology and business landscape they would be extra careful in shortlisting a potential company. They don’t want to end up acquiring some company whose technology can’t be adopted to new challenges in the market. The tech due diligence will also be a critical factor in this. Both SC and PA will be looking at it closely so that they don’t put a wrong step in an hurry.

    Lycos / Daum
    The priority of this item depends on how much Lycos is going to generate now, it’s profit percentage vs how much they have to pay. The equation still seems to be tilted towards paying higher price for Lycos. I feel going slow is a better decision, but at some point they will definitely close it some way or the other and stay clean on legal matters.

    Overall, BCG has just started its journey of explosive business growth, the growth is going to be continued in coming quarters and years with the drivers coming in the form of FCF, inorganic growth, technology additions and operational efficiencies.

    Overall, if guidance was a big take away in last call, the assurance of reaching those high guidance targets and the assurance of a large FCF generation is a big take away in this call. The extra emphasis on ROE is a icing on the cake for the long term investors.

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