Byke hospitality - Truly asset light?


(Vikas Kasturi) #204

Shyam- Add Other Income of Rs 7.7 to Rs 1774.1 (Investor Pres) and you will end up with Rs 1781.8 Mn. This matches with Rs 17,817 Lakhs in the Earnings release.


(ravish) #205

What to take from latest investor presentation only one info that they have added one new hotel and three of all the hotels are not operational for the reported period. One of them has been added 6 month back and another one Delotel 18 month back !!! what is cooking no body is having any idea. Delotel if not ready than it should be disposed off and if they are not able to rerun a hotel in 6 month than this is a big failure on execution side. They are wasting a good amount of profit on non running hotels annually. They were doing outstanding when sector was down but now they are doing bad in this good time for the sector. They are loosing there room chartering business and lagging behind in opening new hotels. No management commentary to look for …this is very sad for us.

Discl: Invested from high levels.


(vignesh) #206

Spoke with the investor relations team. Following were the inputs provided.

  • On why conference call is not held - Due to bandwidth issues.
  • 3 properties not yet operational - One of the property partially started functioning. All 3 expected to be operation by Q3 FY 19.
  • On Room charting slowdown - Competitive intensive high and not getting the right price. Mgmt currently focusing only on Mgmt contract / Franchise business.
  • In order to improve operational efficiency , brought in a new COO from Sterling Holidays.
  • On promoter increasing stake - There are plans to increase stake though they didn‚Äôt commit on the timeline.
  • Investor communication - Working on a more detailed presentation and annual report . Expected in next 2 weeks.

(paresh.sarjani1) #207

Annual Report is out and I feel my money is in safe hands

Points to highlight

Disclosure : I hold this stock and views may be biased.


(Johns George) #208

Thank you Vignesh. May I know whom did you speak to?


(Shyam) #209

The company says they are conscious of the brand image. But, the ratings of the properties were not that good in hotel booking sites. Not sure if they had recognized that.

From AR:

Brand risk: The business is vulnerable to 
a decline in service and property standard, 
which could affect overall viability.

Mitigation: The Company leveraged its deep 
knowledge of the hospitality sector to train 
employees translating into superior service, 
guest retention and higher share of the guest 
wallet, the basis of business sustainability.

Also, they mentioned there is 6.6% revenue increase while the financial statements show a decrease of more than 30%. Probably am missing something here.

From AR:

Despite these headwinds, the Company maintained its 
overall performance and protected its Balance Sheet, 
a validation of the robustness of its business model. 
Revenues increased 6.6% and profit after tax increased 
12.5% during the year under review, which helped 
sustain the momentum of profitable growth. The 
Company reported an EBITDA of H69 cr, EBIDTA 
margin was an attractive 39% and return on equity was 
21% in 2017-18.

Disc: Invested and planning to add more


(paresh.sarjani1) #210

It was changed revenue recognization… For Chartering business now they consider net income and not whole sales…it’s written already


(Shyam) #211

Thanks @paresh.sarjani1. Somehow it was not that evident for me to locate it as I usually start from financial statements and associated notes.

Just for info of other VPers, have pasted the relevant sections for consumption


image



(paresh.sarjani1) #212

No probs. If you would have followed quarterly results since last 3 quarters then it would have been more clear… cheers


(paresh.sarjani1) #213

Sharing from the thread of Royal Orchids


(vignesh) #214

I spoke with their investor relations team.


(Janme) #215

While going through the Balance Sheet for AR2017-18, Non-current Financial Assets has increased by 10Cr.

When referred to Note-6, this increase is due to the Loans and Advance given. But I am not able to find to whom this advance is given.

Similarly, in Current Financial assets, there is Other advance of 40Cr. for last three years.

To whom the company is giving these advances? Would like to hear the opinion of fellow VP members.


(Hrusikesh) #216

The one in Note11 seem to be the advance given for room chartering but I am not sure.


(Janme) #217

Yeah, looks like it since it is in current assets. But advance in non-current asset is still a mystery.


(Hrusikesh) #218

I am going to attend the AGM tomorrow. Anybody else coming there?

Please let me know if you want any question to be asked.


(Rushikesh Kanthamani) #219

Hii Hrushikesh,
Good to hear that you will be attending the AGM,
My questions-

  1. On Tripadvisor, the ratings by guests have been very bad. How does the management plan to address these issues? Normally, hotel managers atleast acknowledge the reviews and promise to correct them. Byke seems to be doing no such damage control, which would only make it worse for them. How can they franchise, when the brand takes a beating every time a customer leaves negative ratings?
    The above question is very,very important pl ask this for sure and see what and how management answers it.
  2. Ask them the reason for not hosting concalls anymore, we as minority shareholders have many questions and need regular updates on qtrly basis. Please request them to host concalls
  3. There is both margin as well as revenue erosion in this qtr, whats the reason and why such a erosion seen. And any revenue and ebitda margin guidance going forward like for next 2 yrs.
  4. Why they are pledging shares though small qty,they have stated the reason that this funds are required for Choice Finserv Pvt Ltd. Why they are pledging their shares and using the funds else ware, as it creates doubt in investor’s mind, that too at the wrong time when there is a hard time going-on with small and mid caps. And when will they get it released.
  5. What kind of steps they are taking to tackle Oyo rooms, as now a days Oyo is in limelight and have a dedicated app, but byke doesnt have any of its own app. Last year I asked them abt the same, they told that they are building as app soon, but It seems they have not worked on that part, so pl ask them if there is any development on that front. Future will be all app-based thats why. Oyo has a very good user freindly app.

These were the questions from my side.
Thanx a lot Hrushikesh


(vignesh) #220

Any one has any Idea on whats happening with the company ? Why it is falling 12 % ??


#221

First questions looks trivial but which has a direct impact. If the managers should at least acknowledge the mistakes and give some reasons but if the questions and complaints go unanswered, they would directly influence the decision to stay in those hotels, people will at least get suspicious of the hotels. In this day and age, when you are in a business which can grow with word-of-mouth, and if you are turning a blind eye to that for whatever reason, you are losing customers.


(paresh.sarjani1) #222

Wondering same thing… Fall from 160 levels to 77 levels… Remains mystery…

Delivery percentage of 80% in NSE today on volumes above 3 lakh shows demand at these levels though…

But the fall is mystery


(kauban) #223

Hi @Hrusikesh ,

How did the AGM go? Any updates on what is holding up the OC for Delotel? Its now almost 2 years since they signed the lease.