Four people from the board of subsidiaries resigned (2 independent directors and 2 Directors), is it a cleanup or rats jumping off the sinking ship ?
@jhon_azhar your viewed on this will be appreciated, thanks in advance
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Yes it’s a very risky stock.
One can’t allocate much capital in it.
I have a position but that’s a small percentage to portfolio, it’s a risky bet.
I have seen these episodes in yes Bank just before it went down and retail start buying that like nuts.
Directors resigning and simultaneously promoters selling and retail absorbing the sell off.
These resignations don’t bother me as much as them clubbing with Malvika offloading in open market in month of Feb or March itself.
Reminds me of a pattern to yes Bank, just before it went down.
On the contrary , there is an argument , that numbers q0q are improving , they are showing signs or revival in BS by debt reduction and non core asset sale.
PNL is turning corner gradually.
It is a hard guess, which one to prioritise , the actions that are brewing within the company in terms of board resignations , promoter sale.
Or their PNL and BS.
It’s a wild guess at this point in time.
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Thanks for the response, I completely agree your comments. Need to watch if the numbers can be sustained and debt reduction continues.
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Company has failed to service debt again in March as disclosed in their filing today.
Market didn’t react negatively to the news infact stock closed strong.
But this red flag has totally changed my investment rationale.
I don’t see a point of being stuck in hope investment.
I’ll keep a watch on the stock, since I am extremely interested due to valuations of the company and it could be a potential take over candidate.
But for now marking an exit, till I develop conviction.
Ps: Not a suggestion.
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How does the company look to you people after the recent developments?
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I think at this point, if Malvika keeps fighting and keeps the insolvency at bay, keep paying the interest from core business and forgets the MAECL recovery - that is the only way this can come out of bad times
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what i see is they have recently cleared some debt and so post that screener should be updated with D/E in upcoming results from 0.48 to 015.
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I am tempted to take a position again, all kinds of pessimism built in but she is clearing debts/ has full intentions and then there can be a resurgence of an offer like TATA Beverages of 1000 Cr or someone else
the core business is still strong; alive in B2B as well - coffee vending machines itself is a huge market
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It is just a coincidence that after this post, the stock has been clocking back to back 5% UC with Gap up ? strange!
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Oh wow, we’re the ones driving this, LOL…
The stock had already taken a significant hit. Even strong shares have their limits, especially when market sentiment isn’t favorable due to broader conditions. Now, we’re finally seeing a shift in direction after the toughest month for the market since COVID.
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If you don’t offer your best to customer, not go beyond your call of duty to be so good that he becomes your permanent customer, you may kiss your business good-bye.
Came to Gurgaon today to drop my daughter for her CAT exam. I had 2 hours with me, so I thought of relaxing with a coffee and continue writing my upcoming book. Dropped into the below CCD outlet that was around 5 minutes drive from the CAT center. As soon as I entered it, there was a fungus smell all over. I didn’t complain. I asked for a small cappuccino. 
The staff said that they can’t give a small cappuccino since they only have large size take away cups. But I didn’t want to take the large one. I said, I don’t want a take away, I will have it here. Pls give me a ceramic cup. The staff clarified that they can’t give a ceramic cup since there is no water and those are unwashed. I said leave it then. Give me an Americano if your cups are unwashed. The staff again clarified that even glasses are unwashed, so that’s also not possible. Making one last attempt, I asked, can you give me my small or medium cappuccino in your large cup. They refused mentioning that cups are counted. Frustrated, I asked, “What can you give me?” “We can give you only large coffee and that too only in take away.” Left with no choice, I had to take the large one by spending almost an extra Rs 100. This is
@CafeCoffeeDay
CCD is dying!
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how hard it was to fetch a bottle of water to clean your cups and service your customer ? Do they need some lectures from IIM for this courtesy and common sense. This is a huge problem where lower level employees won’t even do the bare minimum and it’s something very common in our society. Honestly, they all should be removed from their jobs and company need to tell their employees to wake up and smell the coffee. CCD is almost dead and it’s appalling their employees seem unaware of this.
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Sir, could you please explain this in little more detail? I did not quite understand.
It generally means management is taking over shares held by Late Founder, V.G. Siddhartha Ji.
So basically Cafe Coffee Day Enterprises (CCDE) and its founder, V.G. Siddhartha, who passed away in 2019 under tragic circumstances. His passing had a significant impact on the company, both operationally and financially. Here’s an overview of the situation and recent developments:
What Happened After Siddhartha’s Death:
- High Debt Levels:
• The company revealed substantial debts, exceeding ₹7,000 crores at the time.
• The focus shifted to reducing debt through asset sales and operational restructuring.
- Asset Monetization:
• CCDE sold off significant assets, such as stakes in real estate and IT parks, to reduce its debt burden.
• They raised funds by selling Global Village Tech Park to Blackstone for around ₹2,700 crores in 2020.
- Operational Challenges:
• The coffee retail business struggled with declining footfall and competition from brands like Starbucks and independent cafes.
• COVID-19 further hit revenue streams, particularly for brick-and-mortar outlets.
Recent Developments:
- Debt Reduction Progress:
• As of the latest updates, CCDE has significantly reduced its debt to manageable levels, reportedly below ₹1,500 crores.
• The focus is now on operational cash flow and stabilizing the business.
- Reviving the Core Business:
• The company is actively working on revamping its café operations and enhancing customer experience.
• They are likely to prioritize profitability over aggressive expansion.
- Legal and Financial Investigations:
• There have been investigations into the financial dealings under Siddhartha’s leadership, including tax disputes and allegations of fund mismanagement.
Market Sentiment and Stock Performance:
Investors remain cautiously optimistic about CCDE, given:
• Improved Financial Position: Debt reduction has been a positive catalyst.
• Operational Challenges: Growth remains slow, and investor confidence depends on clear profitability.
There is one more circulation above : It is a corporate filing by Cafe Coffee Day Enterprises Ltd. (CCDE), and it relates to a settlement agreement with the Income Tax Department. Here’s an analysis of what’s happening and how it helps CCDE:
What’s Happening?
- Settlement with Income Tax Department:
• CCDE has entered into an agreement with the Income Tax Department under Section 264 of the Income Tax Act.
• This agreement resolves the tax liabilities associated with ₹1,118.5 crore of unaccounted income identified during investigations linked to the late V.G. Siddhartha, the founder of the company.
- Tax Liability and Payment:
• As part of the settlement, CCDE will pay a reduced amount of ₹44.5 crores to the department, significantly lower than what might have been demanded initially.
- Reason for Settlement:
• The settlement comes after prolonged investigations and disputes regarding unaccounted funds linked to Siddhartha. By settling, the company can avoid prolonged legal battles, uncertainty, and potential penalties.
How Does It Help Cafe Coffee Day Enterprises?
- Clears Legal and Financial Overhang:
• Resolving this long-standing tax issue removes a major uncertainty for CCDE, which had been weighing on investor sentiment and operational focus.
- Improves Credibility:
• A settlement signals a willingness to comply with regulatory requirements and clears the company’s name from lingering allegations. This can rebuild trust with stakeholders, including investors and lenders.
- Reduces Financial Burden:
• Paying ₹44.5 crores instead of the full liability allows the company to conserve cash for its operations or debt repayment.
- Enables Operational Focus:
• With the tax issue resolved, CCDE can now focus on improving its core business, such as revitalizing café operations and expanding profitability.
- Positive for Investor Sentiment:
• A resolution to such disputes often triggers a positive market response as it reduces uncertainty about potential financial and reputational damage.
Conclusion:
This settlement is a crucial step for Cafe Coffee Day Enterprises in stabilizing its financials and restoring its reputation. It allows the company to move forward with a cleaner slate, focusing on growth and profitability while removing a significant legal and financial hurdle.
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So from intimation provided on the 4th Oct, where overall outstanding debt was 433.91 Cr, currently it is 427.06.