You’re getting into analysis paralysis my friend. The numbers are clear and self explanatory. Very highly questionable set of numbers requiring some chest answers from the management. Hopefully the management will speak the truth and not give some explanation that’ll soothe the doubts
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@all: let’s try to put in efforts to get more clarity from management.
Have written to the IR team requesting for a concall/investor meet and would encourage everyone to drop an email (investor@8kmilessoftwareservices.com, contactus@8kmilessoftwareservices.com). Since Suresh seems to be in India right now, it might be easier to get his time on concall/meet.
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Investor concall will definitely be very useful. More emails from investors can probably have some effect. I too have written a mail to contactus@8kmilessoftwareservices.com and cs@8kmiles.com with the following questions:
- What steps is the company taking to regain investor confidence.
- What steps is the company taking to increase financial transparency.
- To increase investor confidence, will all the US subsidiaries be audited by Delloitte in the coming quarters.
- To increase investor confidence, will the financials of each subsidiary be published separately.
- Can you please clarify the reason for the significant jump in trade receivables to 252 crores in March 18 quarter.
- Can you please clarify the reason for the significant jump in trade receivable days to 104 days in March 18 quarter.
- Can you please provide more details on Other expenses (2.d of P/L statement). This is significantly high at 321 crores. It is much more than employee expenses of 235 crores which is typically the highest expense component for IT companies.
- Can you please provide more details on Other Intangible assets (1.d of Balance sheet). There is a significant jump from 61 crores in 2017 to 225 crores in 2018.
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Hope Forbes have done their homework:
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Back to back invester meet. Investeren meet link . They had meet Today with Canara HSBC Oriental bank of commerce Life insurance.
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Thanks @h_nazkani ! Great report that you provided. True, the “ageing profile” does not match the days reported, might be weighted. On the other hand, the report does seem like a bit too much of bean counter nit picking to me.
- Warrants issued at 4% discount to SEBI rule of 2014, Share jumps 4x after that (post facto analysis, what’s the point here?).
- Intangibles depreciation rate of 2%, well intangibles are not static assets, they are the *real work* of such a company, refreshed all the time
- taxation lower than “peer” group, 23% v/s 25%
- Zero salary of some people. Well, if I were a half-decent crook, some of these “red-flags” would be easy enough to “take care of”
Well, every business is different, I do not know how well the control group of “peers” chosen match up with Thousands of Miles. eClerx? Just something “IT”?
The report does appreciate some parts of the non-accounting aspects. Advisory board etc. No pledges.
On the other hand they seem very interested in the welfare of the CS, trolling TCS freshers to prove some point. A CS is to keep track of essential compliance aspects, not to provide moral compass.
Discl: Biggest part of PF, a bit too much maybe 
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The profile of CEO in LinkedIn doesn’t add up. He has all of 190 connections and 200 followers. Endorsements are much less. Looks like a profile of an IT fresher starting in his first year. Does not look like the profile of a promoter CEO managing 1000cr turnover company.
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So profile in LinkedIn & followers will decide which is a matured CEO, what about CEO’s who are running alarge empires & don’t have LinkedIn profile? Don’t write absurd on valuepicker forum. will request moderator to insist for better quality content.
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Disclosure: Not invested
I think LinkedIn, especially for a tech firm, is a good heuristic to gauge many aspects. Tech CXOs of atleast small and midsized firms based in the US, write many pieces linked to their business that aim to influence prospects. Further they follow many senior industry leaders to see emerging trends, opportunites and threats. While a presence of a well LinkedIn connected CEO may not reveal anything, absence of it reveals quite a bit, albeit qualitatively. To me, it reveals, at the very least, that the CEO, at the very best, relies on more tenuous sources to formulate his understanding. That is not encouraging.
Not that he is not active on LinkedIn. His interest on LinkedIn is actress Priyanka Chopra.
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The red flags are glaringly obvious in this company. If you think the stock is worth the risk, it’s totally your choice. After all, investing is all about the risk taking ability of individual investors. My post was well intentioned and I personally consider the LinkedIn profile of the CEO to be a very big red flag. Moderators can do whatever is appropriate to my post.
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There is no question “Cash doesn’t exists at all” !!!
See the history you will find its very clear…
You have such a nice way of explaining things, Thanks! I too think they paid with peanuts for their acquisitions. Well, as long as it was a fair barter.
Stocks like these offers good rewards to traders who are nimble. This was my chart from last year when it bounced from 350 levels
This is my chart from this week where 250 looked like good support level
But unlike usual price-action where supports and resistances work based on psychology, in 8k miles case, the CEO appears on CNBC every time its at crucial support so that further distribution can happen.
Its quite intriguing. This current bounce-back though I think may not be as strong as the last one from 350 levels. It could remain within that 250-350 channel at best - At its worst, distribution could start at 270 levels.
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Q1 Results date is announced.
The next board meeting of 8K Miles Software Services is to be held on August 8, 2018 for Quarterly Results
https://www.moneycontrol.com/company-facts/8kmilessoftwareservices/board-meetings/PMS01#PMS01
Good watch… How to identify mispricing. Reminded me of 8k miles which i feel is a classic case of mispricing due to irrational market reaction.
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For those who are invested,
Can you convince yourselves a business that was valued at $ 1,000 in FY 2010 and fully owned by 8K Miles Software Services Limited, can suddenly finds its ownership reduced to 59.72% in FY 14 with no explanation? And, subsequently, in FY 17 the same can get valued at $ 600 million for an additional 1% stake from the same parent that once owned it fully?
Sources: AR 10, 14, 17
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- The company started in 2010 without vc funding and had to ips then hence the $1000 valuation. All startups begin this way. You can do your homework on successful indian and chinese startups.
- Promoter ownership dropped to ~60% because the promoters raised capital for expansion, mostly through private placement.
- The 2017 valuation is based on new IPs and revenue growth that happened over the past few years. Look at the growth rates of Amazon and Microsoft cloud businesses and by extension the growth rates of all ancilliary businesses such as 8k miles. Look at the corelating numbers in a little detail and the growth will start making sense.
Your comment on addition of 1% and corelating that to valuation doesnt make sense to me, what has that got to do with valuation.
I make these comments with the implicit assumption that their numbers are not fudge or illegally manipulated.
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Do anyone know about the financial statement disclosure requirement for subsidiary companies. I could not find individual financial statements of the 5 subsidiaries of 8K miles.
I found this link https://taxguru.in/company-law/care-children-companies-act-imposes-obligations-pertaining-subsidiaries.html where section 136(1) states that “Every company having a subsidiary shall place separate audited accounts in respect of each of its subsidiary on itsWebsite; if company has any website.”
Can some one with expertise please provide more details on the law.
Hopefully 8k Miles is somewhat responsible for the Cloudy outlook of tech biggies
Friends…
AFAIK - In the US, if a US company CEO and/or its auditors file an erroneous ( not even fraud ) financial statements to their investors, they go to the jail straight…So, all this talk of US subsidiary fudging the books and all are just fantasy tales…Unless the 8K Mile’s subsidiary CEOs and Auditors are prepared to do that…and go to jail…That is a rarity…Quite likely, even 8K Miles CEO in India can meet a similar fate in the US legal system, if that is true…
Thats why in the last few decades you only know of 2 or 3 cos doing that in the US and going to jail
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