[odysee]

@JRS , I cannot understand your comment in #9059 about being ‘conservative’ and only considering the standalone local business of BCG and its earnings. How can you leave out 80% of the total business in revenue terms ( that too the mainstream business of the group) and almost the entire profits earned and declared and presented in the consolidated balance sheet and profit and loss account of BCG?
Those earnings are generated through 100% subsidiaries ( fully owned by the India listed entity), and constitute an integral part of the BCG Enterprise.
It would be a fallacy to consider otherwise.

[odysee]

We are dreaming again I suppose. 25,36,48… Let it cross 10 and 13.02, and we can say maybe game on.
It’s struggling at 5.30/5.40 and no one with deep pockets has the guts or confidence to buy or add.
Never mind, hope lies eternal in the human breast. Dormant mostly. But can surprise occasionally.

[odysee]

@aindia, thank you, good information. But how is this relevant to BCG? Or to us retail shareholders? The stock still trades at Rs 5.30. You can buy as much as want around this price, give or take a few paise.
The company will earn at least Rs 9 per share , if not more, in this financial year ending 31st March 2021. Likely more, with all these enhanced business opportunities as you have also indicated, and based on very promising prospects as indicated in the last conference call.
What a bargain!
‘Never look a gift horse in the mouth’. So the saying goes!
And yet , here we are, on this forum, justifying the current company valuation on account of manipulators, market operators, outstanding issues, sentiment, lack of trust etc etc.
Frankly, it is all speculation and we really have no clue as to why we are where we are.
But we do know that , one day, justice will be done and BCG will shine.
We just don’t know when that day is though.

[odysee]

@Antu, I’m sure the management was fully aware of the complexity of the LOC process when they commenced their efforts, and understood clearly that it was not a cakewalk.
And don’t forget the involvement of BDO Global in some way or the other. I’m sure they have some seriously smart people.
And SKR mentioning in the conference call months ago about discussions with a well known US bank.
The tentative timeline would have been indicated then only.
No company worth its salt steps into a major exercise like this in a haphazard manner. And this is a multinational company with competent management heading the subsidiaries. They would have access to some very smart financial brains at the international level.
Mr Reddy is not exactly a novice at this, having raised millions of dollars in the past from VCs and PE funds.
So let us not for a moment believe that the BCG management is helpless in this matter.

[odysee]

Sorry. Axis has to be settled.

[odysee]

First Axis Bank has to settled.
Then the LOC has to be obtained.
Only then can Daum be settled.
But the LOC situation is opaque and not at all clear.
What if the LOC doesn’t materialise? In the near term? Or it hangs fire for an inordinate amount of time?
Are we to then believe that the stock price never goes up?
Or it is managed forever around these levels?
Surely the impasse has to be broken at some stage.

[odysee]

The market capitalisation of BCG is approximately 270 crore. The annual profits are around 400 crore after tax. Every year. For the last many years.
Seriously!!
Is there a disconnect? Is it absurd? Most definitely so. Can anyone on this forum recall or inform of a similar situation with any listed company on the BSE or NSE ? Ever? Steady turnover over the last many years, around 2500 crore every year. Earnings per share at about 4.5 times ( Rs 9 approx) the face value of Rs. 2 per share. Every year.
Is the management of BCG seriously not concerned with this ridiculous situation?
It is a public listed company after all. The public invests based on the business, the industry and entry barriers,and the financials and the efficacy of the promoters and the management.
Is there no sense of obligation on the part of the management to reward or provide a sense of satisfaction or gratitude to the investor ?
I’m not talking of empathy here. Only the moral and statutory obligation of the management of a public listed company.
I cannot comprehend the lack of effort on their part to address this gross mismatch and the increasing frustration and despair of retail shareholders, and to repair their damaged reputation with the investor community.

[odysee]

My apologies @m4max1979, I mistyped your forum name.

[odysee]

@max4nax1979, I am fully aware of borrowings in the holding company for funding of overseas subsidiaries, and it being a common practice.
The point here is that the purported funding is not local , but a line of credit from a US based lender or consortium of lenders against receivables of multiple foreign subsidiaries of BCG. Clubbed together, the receivables are fairly large, and hence the originally stated purpose of a newly set up company in the US to encompass 12 existing subsidiaries.
It was indicated that this would be a more pragmatic and doable approach to acquire funds for business expansion , particularly since this entire business is overseas and well understood there.
The situation today is somewhat opaque and cloudy.

[odysee]

Appreciate your response @ Logan, and I am in sync with with the content of your post. But then the question would arise as to which entity would be the recipient? Who will be granted the LOC? Unlikely that each individual subsidiary would be serviced by the lenders. Hence, the question of the new consolidated entity comes into play. And the creation of that to encompass the business of the 12 subs. That matter is on hold as we were briefed.
As you had also indicated, there could be many complexities (including taxation related ) if the LOC was granted to the listed holding company i.e. BCG , as then further distribution and funding of the subs for business expansion located in different countries would arise.
No clarity on this until provided by the management. And no useful purpose is served on our speculating on this at this point of time I suppose. It will happen when it does.

[odysee]

All excellent points and suggestions @ Logan.
I agree that the BDO Global report ( if prepared ) of subsidiary companies does not need to be released to the public at large. But,
is there a confirmation that the audit of the subsidiaries is actually being conducted by BDO Global? That’s all that really matters if the answer is in the affirmative. We know that OMS of Israel was audited by E&Y. And that audit report was not made public, nor is it necessary.

[odysee]

Thank you yet again @Logan for your steady and balanced chain of thoughts that you have shared with us.
All the points and rationale provided are logical and reasonable in the context at hand.
At times, frustration gets the better of reason, and one articulates it in a not very pleasant manner as has been the case this time again on my part.
Point well taken- growth is the key, and the company has taken a very balanced approach to try and achieve that without compromising on profitability. Most start-ups and rapidly growing companies are actually loss making, burning cash and have negative cash flows. Many raise funds regularly but continue to be cash negative despite high growth. And yet getting high valuations in the market place.
Effectively buying growth (with fresh borrowing or raising capital) continuously but not making profit for years on end. And yet the market rewards them. That’s the nature of the beast.
Thanks again. Looking forward to a very bright future for our Brightcom.

[odysee]

I should add that there is always a risk when investing in equities and one may or may not get a return. But this chap was specifically told to keep the faith and persevere for a bit longer as the company was at an inflection point.
He’s still persevering I guess.

[odysee]

Sounds promising @Logan as per your comments @#8925.
But is there some grand design that we cannot see behind this strategy of not settling outstanding issues?
If the objective of the management was to destroy the share price and make retail shareholders really unhappy and lose whatever little trust and faith remained, then it has succeeded admirably.
Maybe the directors of BCG should replay the recording of last December’s conference call, in which this old gentleman( the first caller) appeared to be almost in tears when he recounted his having divided his investment into two equal parts- one in a fixed deposit with a bank and the other in Lycos Internet. The Lycos ( now BCG) investment value was at about 1/10th the FD value at that point of time in December 2019.
Unconscionable!

[odysee]

Thank you for your comments ( #8911) @Logan.
Your last sentence is of particular importance. How can any promoter or CEO not want to be trusted by the stakeholders? I really cannot fathom any thinking contrary to that. And shareholders and admirers and supporters have been bleating for years for SKR to adopt a radically new approach in dealing with the public and the markets. As you said, he’s a really smart guy but handicapped by his reluctance to win over the hearts and minds of his shareholders and other stakeholders.
We were all immensely pleased with all those professional presentations released earlier this year about the company and the nature of its business and the financials for the last 5 years. And these had followed your painstakingly prepared commentaries detailing the journey of BCG from inception and particularly the fund raising and acquisition and growth phase.
And I’m sure many us exclaimed -‘wow, now BCG is truly coming of age’, and the future looked so very promising from a shareholder’s perspective.
Alas, it was not to be- at least for the time being.
But as you hope, and we along with you, that the time has come for Mr Reddy to “take the right decisions”.
With 50,000 odd shareholders cheering him on, he has no other option.
Fingers crossed (just in case..)

[odysee]

@Logan, I wonder where BCG would be if it were listed on Nasdaq or some prominent overseas exchange. The bulk of the ad tech and digital advertising business of the company is in international markets and so are most of the profits, translating into handsome earnings per share. Growth would possibly have been easily managed as raising funds would have been so much easier with a realistic market valuation, as recognition of the business and the industry is well in place.
Instead, we have local ‘analysts’ continuing to harp upon software services and information technology etc. with a crude analysis of the numbers without even a glance at the positioning of BCG in the international digital advertising and ad tech space and the other internationally known players that that it rubs shoulders with.
Such is the irony and downside of the listing here.

[odysee]

My apologies @Logan. Thank you for sharing that excellent article in the Financial Times on The Trade Desk.

[odysee]

@Logan, do you really believe that the BCG management will give importance to the investors and improve on transparency and communication skills?
Proper valuation of the company has never been a priority for the management and I’m not so sure that the brains’ trust of BCG believes that there is a compelling need or desire for it to change tack.
(A totally misplaced belief in my opinion)
But who knows? Maybe the leopard will go for a makeover and actually rearrange its spots!
I truly hope that Mr Reddy and his team pay some heed to the very sincere and positive suggestions made by you over the last many months and some other members on this forum.

[odysee]

@drjaysee, it is very difficult to comment as their understanding of the business of the group is negligible. It is purely a numbers based analysis with no knowledge of the industry that BCG is in and there are no meaningful company comparisons.

[odysee]

@lycos.rags.to.riches, the only problem with not looking at the price movement on a daily basis is that the relief at seeing it at 13.02 turns to utter despair in 3 months when one happens to take a peek at the price, and note that it is on lower circuit at 5.05.
I really admire the guts and hopes and resilience of all on this forum ( that includes me by the way). We all have this unique talent of being able to justify the miserable price our stock commands on the Exchange. Fortune favours the brave, not the foolhardy. I trust we all fall in the former category.

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