Basilic Fly Studio Ltd

Stock Opportunities Untested - but worth a good look
62

Contrary to others, govt initiative might be negative for existing companies since new players will come and margin will contract for existing player and that is the reason that all vfx companies are going down.

Happy to hear thought of other VP members on this

1 Like
63

63 cr receivables on 100 cr sales shows poor bargaining power. Very hard to correct as customers get used to easier credit terms

64

We have to accept this risk as this is industry wide.
As mentioned in concall:
One client have stress and agreed to instalments for 15cr. Temporary requirement due to market downside in North America. Steady state receivables will be 90 to 180 days.

D: Invested

65

63 -15 = 48 out of 100 still too large for my comfort.

1 Like
66

Do you guys think AI platform like Sora and others can become a future threat to VFX companies like BFS and others ?

I think in 5-10 years text to video generation platforms will mature and can easily do the same work in less than half or fraction of cost.

I also tried to find any questions related to this in concall but unable to find anything.

67

Basilic has fallen around 27% from the peak. Has the investors completely lost trust in management?
I am still very bullish on the VFX sector but it seems like every VFX company is falling right now.

68

brijyot_chawla Agree with you. From Highflier to dusted due to result error, which obviously cause concern about management integrity.
However, stock is under pessimism due to:

  1. Concerned Management integrity.
  2. Competition in VFX Field.
  3. AI threat ( In my understanding it is perceived, Any field always have threat related to new technology)

Future triggers:

  1. As guided, 30 to 50% revenue growth with similar margin.
  2. New aquation/partnership.
  3. Acceleration on order book from current 75 cr.
  4. Management proves integrity by demonstrating that they are clean and fair.
  5. If we see growth and integrity coming in few results, valuation is very supportive. TTM PE is 20. Where growth expected is 40%.
  6. Government support which is announced.

In Nutshell, management has to demonstrate growth and integrity.

D: Invested.

2 Likes
69

Thanks for sharing your thoughts. I completely agree to your perspective, the biggest threat I see is management integrity. Even before this results fiasco, what I have observed is the CEO does not have a full grip on the company, majorly on the financial side of things. He is great when it comes to VFX tech side and what is happening currently, however, I would expect my CEO to have full grip in entire company and have vision about how company would look like in next 3 years which seems to be missing.
However, saying that I still believe it was a genuine mistake (I could be biased when I say that), but they have totally lost investors confidence now.

2 Likes
70

BFS stock price has increased ~20% in last 5 days, does anyone know what is going on? Cannot find any news or announcements around it.

1 Like