[odysee]

Thank you @Logan, once again. Yes, the analogy makes perfect sense, and I had similarly expressed my reasoning for the likely rationale behind the move at the point of release of the March results in June, including the fresh start or clean slate angle, especially since a major international audit and consulting firm was engaged in the consolidation exercise.
Mr Reddy and his team have clearly stayed on top of the professional and ad-tech business game.
Now that they are much more conscious of the requirements of the investor game, we look forward to seeing satisfactory action on that front too.

[odysee]

Thank you very much @Logan for your painstaking, detailed and well-reasoned viewpoint on a whole gamut of issues plaguing the minds of possibly a large number of long term investors of BCG.
At times, minor frustrations tend to overshadow the big picture of so many positives in the BCG story. Also, many a time, the retail investor cannot put the story together in his or her head in a cohesive and coherent manner, and that leads to the mind playing games of unnecessary negativity.
Truly appreciate the fact that your very deep study and understanding of the industry, the business, the company and the promoters, is helping all of us gain this tremendous insight and knowledge, which otherwise would have been almost impossible even for a keen and savvy investor.
You do provide loads of confidence to a generally loyal and dedicated lot of us ( even though prone to bouts of anxiety) on this forum , and for that I am truly grateful.
I would be less than honest, however, if I didn’t articulate one area of niggling concern, and that pertains to the huge value of impairments that were necessitated in March 2020. The exercise of identification of what assets need writing down or writing off by way of impairments and other pruning is done annually by most companies, with BCG being no exception.
What was missed( if that is the correct word) over the years in the annual exercise, that required such a radical cleaning up at one shot. The management did provide rational reasons in a note as we all know but the principle of annual house-cleaning was clearly not stringently followed over the years across all subsidiaries.
But then, as you explained, this is such a complex business, which requires constant updating of technology and practices and investment, that simplistic queries are best left unstated.

[odysee]

@Logan, thank you for your comments on programmatic advertising in India. It does explain the lack of a forceful BCG initiative in India. On the other matter of fund raising etc., my objective thinking ( although now I’m biased being a long term retail investor) is that SKR should never have gone public in the first place. Better to grow as a private enterprise, where VCs and PE investors understand the potential risks and potential phenomenal gains, rather than be at the mercy of cunning market operators and manipulators. This can stymie the entire growth process as we have witnessed. Further, a critical and important change is required in the mindset of the promoters if they go public, and that is treat all stakeholders including small retail shareholders with respect and consideration, and pay heed to their needs and aspirations. Good, regular and timely communication with clarity rather than ambiguity is a key requirement. Earning the goodwill of 40,000 ( earlier 30,000) small shareholders is an essential requirement too. How does a promoter ( and management) fulfil that? In what manner can those small ( not fully informed) shareholders be rewarded and not made resentful? Unless Mr Reddy and his fellow promoters seriously address this glaring anomaly in their otherwise professional running of the company, they will have a tough time in coping with the disadvantageous public perceptions and sentiment.

[odysee]

I should clarify that some Indian entities are existing clients of BCG and hence it would be reasonable to expect some revenue generation although not clear as to the quantum.

[odysee]

I never got a chance to come on at the conference call even though I was very prompt with the pressing of the keys. Primarily because of one thoughtless and inconsiderate caller who went on and on, denying many others a chance to participate. My question, if Admin or Logan can address, is whether the BCG group generates any revenues emanating from India in the digital advertising space? If so, any thoughts as through which entity? If not, then doesn’t the resounding new mantra of a Digital India provide tremendous opportunities for BCG in the home theatre? I am assuming that the parent listed holding company is only in the software services and consulting business. Thanks in advance.

[odysee]

@sateanna, ref your comments at #8322, my clear recollection is that SKR was to sign the settlement agreement and make a down payment. The balance amount was to come from the LOC.

[odysee]

Not in complete agreement there @sateanna. The con call may have lacked any dramatic statements, but my take on the LOC is different. The structural aspect of the line of credit is still evolving, as there may be active consideration of the funds being made available to the listed holding company directly ( BCG). Appears the body of credit providers is still evaluating the option. My reading is that the new 100% subsidiary to be set up to encompass the business of the 12 subsidiaries will be designed for a larger international role with even a possibility of an international listing (purely reading the tea leaves), but that is on hold at the moment because the recipient (BCG in India or the new holding coy)of the LOC is still not determined.
As long as the LOC is approved, it doesn’t matter too much to us, although strategic considerations will come into play for the management and the promoters.

[odysee]

If one expects status quo on all issues (again), then we may as well have no expectations on the stock price ever getting even close to book value. Even getting back to low double digits of 13.02 ( a fleeting chimera) may be a very difficult task. The business may be complex and great , and the promoters may happily live with that and their vaunted position in the world of ad-tech, but the retail investor is a little simplistic in his understanding and expectations- invest his/her hard earned money in a listed profit making, decently managed international company, and make a decent return on the investment. That has proven to be an exceedingly difficult enterprise over these many years. Remember the first caller in the conference call in December 2019? His anguish was palpable-invested equal amounts in a bank deposit and BCG many years ago, and the comparative return on investment as of then ( Dec 2019) was shameful. Even Mr Reddy appeared moved and displayed genuine empathy and suggested the investor should not lose heart, and declared that things would change very soon as the company was at an inflection point. Well, we, the long term wretched lot of retail investors at least , cling on to our hopes that, one day, the tide will turn and BCG will gain recognition in the financial markets too.

[odysee]

@Rathi_b, it would be better for admin to collate all the points and submit them to the company for a response. We did succeed to some extent the previous time. The problem is the intervention by some shareholders in the conference call who deliberately appear to ask irrelevant questions and eat up substantial time, leaving others with more meaningful questions waiting in the queue and not getting a chance to interact with Mr Reddy. I really do think that BCG management needs to allot substantially more time to the conference all. And I sincerely hope that this time we will get clearer answers and timelines. Or is that asking for too much!!!

[odysee]

Thank you for your thoughts @Logan. I’m wondering if DSP and DMP models are more productive in the long term.
As per my earlier readings provided by you, the strong DSP players could play dual roles( SSP too) over time. And possibly venture into the DMP place as well. BCG appears to be limited to the SSP sphere, although it’s done well in that, but facing many challenges, both because of the business practices impacting cash flow pressures as well as because of some poor ( in hindsight) business decisions.

[odysee]

@Logan, it then stands to reason that the growth and cash flows of a DMP will always be superior to that of an SSP. Could BCG not have established an arm or a subsidiary years ago, that operated as a DMP, considering it had such vast experience in the field of digital advertising?

[odysee]

@tanvi51, I may not fully agree with your viewpoint. An OTS, if agreed to between a bank and a defaulting borrower, would play itself out as per agreed terms and conditions. If certain instalments have been paid by the borrower in line with the OTS agreement, but if a delay occurs at the time of the final instalment, the OTS does not become null and void, with the original outstanding amount resurrected, and the payments made thus far under the OTS becoming normal repayments of the original outstanding. The courts wouldn’t have agreed to hear the respondent’s ( BCG) views at all in that situation. It is another matter that BCG should have honoured its commitment when due. After all, SBI and Canara Bank were settled in a similar vein.

[odysee]

Thank you @ Logan. Your response and views are truly appreciated.
I wonder if Mr Reddy and his team do bother to read all these posts on this forum and get a sense of the sentiments and views expressed.
He should understand that we all are loyal supporters of him and BCG, and have stayed steadfast in our beliefs and goodwill over the last few frustrating years.
Testing our patience and resilience is bearable up to a point but surely even he understands the concept of overkill.
My sincere advice ( although biased being a minority shareholder) to him is to now fulfil his promises in the shortest possible time, come what may, and restore the respect and credibility that he has enjoyed, thus far, from this currently miserable and disgruntled lot on Brightcom investors’ forum.
Far too long he has raised our hopes and expectations on timelines, but he has always left a tiny wriggle room for himself.
Enough! Being too clever by half is not a suit that Mr Reddy should ever don or aspire for.

[odysee]

I would like to add another point. There are certain responsibilities and obligations that are an integral part of any venture involving the public at large. If a promoter chooses to go public by inviting investors to participate in a business enterprise, with a stock exchange listing of that entity’s stock, then he is duty bound to protect and advance the interests of the minority shareholders and other stakeholders. If the promoter has a cavalier approach to the sentiments and interests of such minority shareholders, then he or she should never have gone for a listing in the first place , either via an IPO or a backward integration with a public listed company. Far better to fund growth and expansion through the private equity or/and the venture capital route, and let the business become strong and vibrant, before going for a listing to enable a decent exit if so desired by those players.
Given the current situation, we, the minority retail shareholders of BCG, are neither here nor there , caught between a rock and a hard place. Not an enviable position to be in.

[odysee]

@Logan, despite promises at almost every single conference call over the years, Mr Reddy has time and again stated that one should send him a mail as he couldn’t at that particular point of time remember the exact figures (e.g. ageing of receivables), other important data points etc.
Not replying even once is very, very regrettable. The investor relations department is in any case in deep slumber for many years. What a sorry state of affairs. Amen.

[odysee]

@lycos.rags.to.riches, your point is well taken, but in this particular instance, the verbal settlement appeared to have been arrived at with Axis bank. Please note the wordings of the communication sent by BCG to the exchange- “after due consultation with the officials at Axis Bank, the company has sent a formal request letter to the bank”.
This would suggest closure was imminent.

[odysee]

Not impressed with BCG’s actions. If they had already advised the stock exchange about a formal proposal to settle with Axis, post verbal discussions with the bank, immediately after the last NCLT hearing a few weeks ago, it suggested to the world at large that the matter was done and dusted barring the documentation. Asking for another three weeks and consequently delaying closing even the first of the few critical pending issues that removes the defaulter tag is indicative of poor management from the shareholders’ perspective.

[odysee]

Thank you very much for your very detailed and patiently articulated views and thoughts @ Logan.
I guess we all just buckle up and wait for the ride to begin, whenever it does.
Incidentally, there appears to be no news on the NCLT case today. My expectation was that a settlement would be announced along with withdrawal of the case by Axis.

[odysee]

Thank you for your balanced response , as always, @Logan. The troubling part is that small retail investors although large in numbers, have holdings which in total ( value and quantity) are not very significant as a percentage, but their actions have a profound impact on prices particularly on the downward side. Only a relatively smaller number of better informed retail investors, with possibly largish holdings, desire and expect actions that would bring stability to the stock price.

[odysee]

Admin, this is not a post that I am putting up that may provide additional information but just an expression of my thoughts-I cannot for the life of me understand the price movement of the stock on our exchanges. It is intriguing, irrational, irritating and frustrating. At a stage when positive developments are gathering pace, what on earth explains this negative sentiment and trajectory?

[Author]

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