Dear Bhavesh,
Thanks for prompt reply.
Going by the growth rates, the company appears to be at inflection.
The next question will be it flies from here or it takes its own time.
Only time will disclose. Already huge run up.
thanks stocklady for initiating this.
Any reason for the stock to consecutively hit lower circuit on nearly each trading day.
Operator driven upside, hence downward spiral . Do remember , itās a Hyderabad based company.
You should change your DP. It is disgusting! I wonder why you chose this horrible DP in the first place!
Cause I think Iām too much of a gud luking thing for people to have objective conversations with me (I guess not in this forum, but out of habit its here).
Earnings call for Intense scheduled on Thursday, 9-Mar-2017 (11:00 am) to discuss financial performance, strategy, outlook and Q&A.
http://corporates.bseindia.com/xml-data/corpfiling/AttachHis/c0d951e8-7fc4-4de3-8da3-943b6d8af545.pdf
Good Question. How do you find a share is operator driven or change of market perception? It will be good to learn this from you.
My experience with market participants is like this.
āIf I donāt own the stock and it runs away, I believe that It is operator driven.ā
āIf I own the stock, the stock up movement is due to my great analysis and Mr. Market is was foolish and now appreciating the great strength in the counter.ā
āIf I own the stock and it starts falling like pack of card, I know for sure that whole world is against the stock and counter is manipulated by Operator.ā
You can choose your thesis or enlighten us. Regarding this stock jumping high and falling sharply is due to shareholding. Few folks holds max share and old share holders keep selling on rise. Just to give you perspective.
There was a call with management and I happen to attend the call. There was doubt from analysts regarding huge receivable days. There is concern on receivables management. I went to drawing board to do analysis of the stock on this aspect.
As per my finding, most of the cleanups were done in year 2012. The whole balance sheet was cleaned with written off from share premium account.
In Year 2013, 4.41% of sales turned as bad debt. Company wrote it off.
In Year 2014, 1.06% of sales turns as bad debt. Company wrote it off.
In Year 2015 & 2016 no bad debt written off. Company is able to collect all sales proceed.
Why this company had big debt write offs. It may be due to they way business deals were done. Earlier deals were done thru System integrator. If you sign a deal with a system integrator, it will have impact on your receivables. You may not get the payment if system integrator has not done good work . You cannot claim money from the customer since you are not visible. System integratorās in India are known for naughty
This is how contracts are structured in IT product company. It is based on milestone.
Example:-
Payment term
On signing contract:- 10%
Alpha - 20 %
Beta - 20%
Gold - 40 %
Post Support - 10%
Payments are generally done in 60 - 90 days cycle from large firms. Now if you have direct contract, you will get money after 60 days from date of invoice. If you are having contract with system integrator, you will get 30 - 60 more days of delay in payment. Generally system integrator will pass on money after getting from customer. Which adds to delay.
Since the payments are based on milestone, most of the milestones get delayed in IT delivery for reasons best known to God. 
Now since contracts are direct, company should be able to get money faster.
Other aspect to note from the call is that companies gives service on its own product. They are not into generic service business, so service business is not captive and predictable like other service companies. This risk comes with reward of revenue not attached with staff strength.
Receivables are five and a half months! 60-90 days is understandable but 163 days? And this 163 days is from the bill date and bill is raised after completion of each milestone.
Too much credit given to yours truly.
Was just a hunch. Maybe I had seen same phenomenon in Pincon Spirits (which I had exited), thatās why I was more wary. I decided to exit now and enter later if this is just temporary situation.
Comes with experience, Iāve burned money āinvestingā in operator driver highs, so maybe that.
Good point. It is not abnormal. In Small IT product/services (mainly working with fixed price contracts) firms the invoices are not uniformly raised month on month. So such skewed numbers come when you average it to 365 days. I am not surprised. You can see the revenue trend of the company and realize that they book revenue in some quarters heavily and some goes very light. It depends on customer, few customers will ask you to invoice everything in year end quarter so that new budget can be worked out.
The cash receiving from date of invoice will be 90 odd days in general. In this case, it may be going to 120 - 130 days in agreements where they are working thru system integrator.
Biplob,
I have seen same price action in many stocks. To be very frank , my strongest believe is that every stock ( including, Reliance, HDFC, Infosys) is played by smart money ( operator) , Operator may be big or small. We need to control our greed and fear and invest with confidence.
If I know my strength to fly, I donāt care how strong is the branch or tree. I believe in this. I keep my position size in control to avoid such miss happening.
Can someone who has attended recently held conference
Can post key takeaway
On an average, it is taking 163 days from date of invoice! And this is not based on annual. This is based on recent numbers.
Official call transcript can be accessed from http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/74d8b715-992a-4920-a6be-c0f11df667af.pdf
Ishank, The reason being more than 90 - 120 days is Unbilled revenue. In case of receivables it has unbilled revenue added. Read Infosys AR it has section on receivables . Gives detail about it.
@Kkarunakar why read Infosys AR for analysing Intense AR. It has different revenue recognition policy. Here is excerpt from Intense AR:
1.2. Revenue Recognition
Revenue from software products is recognized when the sale has been completed with raising of invoice from the
company.
Revenue from software development on a time and material basis is recognized based on software developed and
billed to clients as per the terms of specific contracts.
Revenue from digitization is identified when the specific milestone is achieved and invoice is raised.
As you can see, all revenues are recognised only on raising of invoice/bill. Even the balance sheet does not show any unbilled revenues.
Without Unbilled this number will not bloat as it is now. There are unbilled amount but not disclosed as per my understanding. I believe Infy will also have same policy. The above says about how am I going to book sales (revenue), but does not say that all booked sales will be invoiced in the same time. In product revenue and fixed price contracts , generally unbilled gets added to receivables.
It clearly says revenues are recognised when invoice/bill is raised for all three categories of revenues.
Is anyone aware of any news about intense listing on nse tomorrow?
