[m4max1979]

Hi guys, Notice is out on BSE regarding board meeting for approval of postal ballot for issuance of preference shares. Hoping for things to turn around soon now.

[m4max1979]

Could it be NCDs to private individuals or a company so eventually no dilution of shares?

[m4max1979]

The way I see it, a majority of us i.e. retail investors have been invested in this scrip for 4 years or more. I suggest we have a little more patience. We have waited for so long, it is not difficult to wait just a little while more to let the company stand on solid ground first and then go for the sprint.

[m4max1979]

I have a few queries on the declared results:

1. Which parties has loan of Rs. 168.64 crs gone to in non current assets

2. What constitutes loan of Rs. 755.92 crs in current assets

3. What constitutes Other current assets of Rs. 699.0 crs

4. Which party has the company borrowed Rs. 36.02 crs from in current liability

5. What constitutes other current liability of Rs. 214.97 crs

I have sent a mail to investor relations and do intend to ask these questions given a chance along with questions raised by other boarders here. My point is that the company has nearly Rs. 1600 crs in current and non current assets, why is it so difficult for the company to pay off small liabilities like Axis bank loan and daum.

[m4max1979]

I have no information in this regard so would not be able to comment on that but if this information regarding oak fund expiry is true then I am afraid we might be up for a bumpy ride ahead at least for the next 7-8 months.

[m4max1979]

Thanks Admin for the prompt action against the useless IDs creating nonense here. Pls continue with the good work.

Dear Ian, I do not think Oak will exit at this point. I think they have a better insider info compared to us retailers. Moreover, I do not think operators have the time or means to force Oak India to sell.

[m4max1979]

Abe tu to aise bol raha hai jaise ki ahsaan kar diya kisi pe ek share kharid ke. Yahan na to koi tere kehne pe company mein invest kiya hai aur na to tere kahne pe koi bechne waala hai.

[m4max1979]

You are the RAT here. If you have something something useful to say then by all means share it or else get lost.

[m4max1979]

Hi Sobha, Thanks for sharing you opinion on the board. I too invested in pretty much the same manner you did. However, my early investment was small and I started averaging recently, but I do understand your pain, I have gone through it myself. As stated earlier as well, I have doubts about BCG getting LoC from any lender, However, I would disagree with you on the issuance of preference shares. I think that the company is closing loans from internal accruals and would issue preference shares to close daum. Think about it, BCG has already allocated USD 16 million in its books for payment to daum. Now they are not going to pay USD 37.5 million for settlement and I am sure daum would not settle for USD 16 million after fighting a court case for most part of this decade. Last year BCG board had passed a resolution for raising Rs. 60 crs through preference shares and i think it was priced at rs. 6 per share. If the promoters take the entire preference shares then promoter stake goes up to around 51% which is something they might desire given the shareholding of goenkas & Co. is more than SKR himself.

[m4max1979]

Profit before tax is Rs. 608 crs not 510 crs. BCG4longterm is right, free cash flow is around 123 crs. However, I would prefer the company spend it on closing daum and settling banks instead of dividend. Would prefer cmp around book value for a start rather than dividend.

[m4max1979]

Hi Avi, I saw that notification from BCG but I think it means nothing till the company shares a no dues certificate from bank or at informs that bank has issued one. Normally what happens is that once company pays the entire dues, Bank gives a no dues certificate/ loan closure letter. Company then files for release of charges on MCA site which usually takes a few weeks.
However, we are discussing the source of cashflow for canara and axis bank. I think the loan is from some subsidiary which may or may not have taken loan from director/ promoter. Only time can tell. Sometimes this hiding of information really pisses me off.

[m4max1979]

Well, as per section 179(3) of companies act, board needs to pass a resolution empowering the company to borrow money even from its directors. Normally most companies do not publish board resolutions for the purpose of taking loans. However, in case of loan from promoters/ directors, form MGT-14 needs to be filed with ROC within 30 days. I did not find any such filing in index of charges on MCA site. I am assuming that maybe SBI loan was paid by company and for Canara Bank loan, 30 days are not over yet.

[m4max1979]

I agree with you BCG4LongTerm, I think in order to take loan from promoter, company needs its Board’s approval first. No such approvals have been taken so the loan I guess has been repaid from internal accruals.

[m4max1979]

Nice to hear from you after a long time 108BG. While I am sure your info is correct, in my opinion it is not correct to compare with others right now because everything boils down to CMP and wealth created/ lost for shareholders. When CMP reaches at least book value then probably it would be wiser to compare with other horses in the track. I am just trying to assess the issues and my opinion of timeline for resolution because without that I doubt CMP will even reach double figures.

1. Closure of debt – I remember SKR in Feb concall had said that he would close all deb latest by Sept 30, 2019 but it seems things have got delayed. He said in last concall that they had paid off Canara bank but we do not have the noc yet. I am not sure about this but SKR had said that there was a delay in payment to canara bank which had caused a problem in loan closure. My guess is that the recent sale of promoter shares was done by canara to close the loan but this is just a guess. Axis Bank loan also could be repaid by this month end I hope.

2. LoC for company – I still have my doubts on this and will not believe till the company shares a sanction letter. An unrated company in default with banks and fighting a court case does not get a loan at least in India. Moreover, even if a financial institution shows interest, what collateral does the company have except promoter shares which are valued at less than Rs. 60 crs now and even then half of it is pledged. This in my opinion is a catch 22 situation for the company because if they jack up the price then daum gets riled up and if they keep the cmp where it is then lender gets jittery. I do not see a way out of this but maybe SKR knows better.

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