Good point you bring out Yogesh. The revenue recognition policy does seem aggressive.
My company started in 1992 from UK. Later in early 2000 expanded to US and around 2005 they started expanding in SE Asia. Revenues were diversified. Estimated staff strength will be close to 400 across geographies. This excludes Fieldwork Agents. Generally we outsource Fieldwork (Survey Data Collection) to other agencies.
Are you an employee or the promoter of company. Please disclose.
I am an Employee of the company.
NPM of MRSS is 16%. Also since they are small now, big player will not care about it. But moment they start getting BIg, they will face price wars…
Nielsen, IMRB, TNS, This Industry has got lot of players…
Do these all use percentage of completion as revenue recognition method? Is that a standard industry practice?
50% upfront and 50% at the completion of project is industry standard. In some cases, especially Government contracts it becomes 100% after completion. Companies recognise 50% revenue at the beginning of project. However actual cash comes late. Timelines are pretty tight in this industry. If you win a project, report has to be churned out very fast. If you wait for cash, you will not be able to meet deadlines. That is why receivables seem high.
If I understand correctly, 50% of the amount is billed at the start of the project and due to tight timelines project is delivered even when customer has not actually paid even the advance although the bill is sent and revenue is recognized. remaining 50% is billed only after the completion of the project (and not based on the the percentage of completion). So it is possible that entire 100% becomes receivables for short projects?
Yes. But generally One project is 4 - 7 weeks long. So first 50% should come in in 7 weeks. Rest 50% is only billed when you present report to client and client is satisfied.
Game is different with government contracts, where 100% payment might come after 6 - 7 months of completion. You know how slow file and money moves inside government offices.
Sir…clearly there is some gap between our understanding of this space.
As per me, the biggies are not offering the same tech based MR due to various constraints. Hence the q of price wars doesnt exist.
I have seen that confusion in above discussion. I would like to clear out a few things:
Biggies do offer Tech Based MR. Thing is they are so big in traditional MR so that they do not differentiate on Tech Based MR.
Tech Based MR offerings by MRSS are very basic. I mean really basic. The method shown in annual report are completely outdated. My own company has stopped using some of these methods and have launched new products based on further innovation.
IF you want to know more please search about Implicit/ Neuroscience MR techniques and compare with MRSS offerings
Correct me if wrong …Why is company not paying tax?
It is paying corporate tax…
For FY 2015-16…it paid 0.91cr Tax on 2.79cr PBT…e.i. Tax rate of 32.62%
For FY 2014-15…it paid 24L on 76L profit…e.i Tax rate of 31.58%.
Actual outgo in tax is nil from cash flow statement til FY 2014. Do you have annual report of earlier period (before FY 2014) ?
Co continues to grow at around 100% YOY
Rev 2017 22.93 crs vs 11.12 crs for FY16
PAT 2017 4.63 crs vs 1.90crs
EBITDA mrgns 30% vs 26%
Another point to note receivables have also grown 70% to 10Cr+
MRSS reaching new high of 439 vs FPO price of 114 in Dec 16 & trading price of 140 .
Mine bet was on Sarang Panchal ex head of Nielsen now with MRSS. Glad that the bet has worked out well.
Who else tracks it? When will it list at main board?