Lycos Internet

Hi There,

Can any one put their view on this particular stock even after back to back good result the stock has not been on the right valuation.


Regards,
Narayan

 

I think business model is very weak. Ad blockers usage may adversely affect business of ads. Also use of mobile phones and tablets may affect business.

The PE of stock is 758! This means ZERO Margin for error. If stock not grow at full speed it will CRASH!

Are you in a loss position or a gain?

 

Do you feel a good quality information or software will be available for free??? will you say the same if i ask the view of google company "Ad blockers usage may adversely affect business of ads"????? since their profit is through ad revenue. PE of the stock comes around 4... what do you mean by stock grown at full speed it will crash?? i am in profit... i am just collecting people view on this stock the company is not only in digital marketing but also on IOT and health bands. I am not trying to say that you are wrong i just want to see retail investor view becz the stock is regular pull down by inside traders looks like they have some grudge on this stock in past..

 

Please check cash flow.. its nowhere matching with reported profits.. debtor days of more than 150 ?

 

the negative overall cash flow may be a result of heavy investment expenditures, which is not necessarily a bad thing??? did you check cash flow from investing activities??

 

I want few more questions thrown away any senior person or forum manager or any body put some more questions plz???

 

aren't you convinced about the company and it's business prospects?
on your point of free software - Open Source is the answer.
Sachin made a valid point about the use of Ad Blockers and personally, i use Ad Blockers and flash block on all my systems, always root my android phones and now even iOS offers ad block
and Ad Blockers mean business https://www.wordstream.com/blog/ws/2015/10/02/ad-blockers
https://betanews.com/2015/11/13/are-ad-blockers-killing-marketing-efforts/

 

Digital marketing according to my simple view.
Any media decision let it be tv , radio or newspaper has been deriving its major source of revenue from advertisement.
A few days back I remember that a few ppl complained about the derth of advertisements in the newspapers during diwali times , to which the editor of economic times reported that if the advertisers weren't there then the cost of your newspaper would be rs 25-30,so instead of complaining we should be thanking the advertisers, he added.
Also, regarding the view that we still do not like the advertisements that are flashed between our favorite programmes but still this has been continuing since decades.
I my view any form of media will not be able to function or if function will not be able to maintain a reasonable price if advertisements are not present.
And seeing the present shift in digitalisation , I feel that digital advertisement is the next big thing.
Comments are invited for the same.

 

I am convinced on the business prospects of the company, then open source is a diff thing and doen''t comes under the ad blocker context , ok so when you use a <free> mobile application do your ad blocker works? when watch a video on youtube and suddenly advt plays does you ad blocker blocks that do you feel efforts of building a application or some good informative and entertaining will be given free to you? i agree now a days people use ad blockers in browser but most of them use if they feel the number of ads are more, 1 or 2 are just ignored. If you open google finance how many ads do you see 1 right that is normal. If you read more of news or high traffic site which engages user in reading or playing games you may find more number of ads what i am trying to say is the the scope for online digital marketing is vast just cannot be restricted by ad blocker.

 

nah i'm not saying open source apps and ad blocker in the same context, Uppu
yes the ad blocker works in every app including YouTube when I'm using a rooted phone, if you use alternatives with a non rooted phone - it uses the VPN trick and at times, the adverts do pop up

marketing is here to stay, there's no denying that
just a point that people do want to be free from this all intrusive personalized adverts and more and more people are opting for an ad blocker, not sure about the Indian users though

coming to the point of rewarding the developers efforts, i buy games/apps that i like but i prefer to save my time and bandwidth too

also i read about Lycos over a year ago - don't remember if it was during their acquisition or a name change and didn't know it was listed and then i see it flash on TV screens a couple of times and thought it was an ISP and considered buying but never took a look
i'm glad you posted!

 

What is rooted phone? Is it like Android or something else?

 

Srouta, rooted is like you have administrative rights and can do everything with your phone (Linux - root level access)
https://www.xda-developers.com/root/ - if at all you decide to root, be very careful and read the instructions, it can possibly even brick your phone!

 

Ok Thanks. Too much high tech and is not for me

 

Initially even I was negative on this stock but later I investigated the company closely on the fundamentals and business frontier and found it to be a good business at undervalued price.
My analysis is as below.


Segment wise Valuation of Lycos Internet

(a) Digital Marketing Segment(Ybrant/Brightcom and subsidaries)

Net Profit = 608.08 CR

EPS = Net profit/ number of shares = 608.08/47.62 = 12.7

Intrinsic value assuming a PE of 7 = 7 * 12.7 = 89 RS

Intrinsic value of Digital Marketing Business of Lycos = 89 RS


(b) Software Development Segment(LGS Global software)

Net Profit = 79.3 CR

EPS = Net profit/ number of shares = 79.3/47.62 = 1.6

Intrinsic value assuming a PE of 7 = 7 * 1.6 = 11.6 RS

Intrinsic value of Software Development Business of Lycos = 11.6 RS


Total valuation = Digital Marketing Business + Software Development Business
= 89 + 11.6

Total valuation = 100.6 RS
=======================================================================================

Fundamentals from balance sheet:

Liquid cash: 430 CR
Shareholders money in total investment = 82%
Share of Short term debt = 14.5%
Share of Long term debt = 3.5%


For paying RS 250CR ($36.6 million) to Daum the following funds can be used
- Liquid cash for 430 CR can be used

=======================================================================================

Conclusion:

1. Its software business alone worth(11.6 RS/share) more the current market price(8.3 RS/share)
2. The stock is beaten because of the negative impression around the management
3. Force motors stock was also down for a long time because of negativity about management and "porinju veliyath", the famous value investor, took advantage of this and the stock proved to be a mulitbagger for him in few years.
4. Company has good liguid cash and Lions share of business investment coming from share holders
5. Strong Software Business from LGS with very respected client base. Strong digital business with cutting edge brightcome technologies and fortune 500 companies and household famous brands as clients.

In conclusion this a business I would like to buy because of huge potential for growth and also huge undervaluation of the business.

 

Initially even I was negative on this stock but later I investigated the company closely on the fundamentals and business frontier and found it to be a good business at undervalued price.
My analysis is as below.


Segment wise Valuation of Lycos Internet

(a) Digital Marketing Segment(Ybrant/Brightcom and subsidaries)

Net Profit = 608.08 CR

EPS = Net profit/ number of shares = 608.08/47.62 = 12.7

Intrinsic value assuming a PE of 7 = 7 * 12.7 = 89 RS

Intrinsic value of Digital Marketing Business of Lycos = 89 RS


(b) Software Development Segment(LGS Global software)

Net Profit = 79.3 CR

EPS = Net profit/ number of shares = 79.3/47.62 = 1.6

Intrinsic value assuming a PE of 7 = 7 * 1.6 = 11.6 RS

Intrinsic value of Software Development Business of Lycos = 11.6 RS


Total valuation = Digital Marketing Business + Software Development Business
= 89 + 11.6

Total valuation = 100.6 RS
=======================================================================================

Fundamentals from balance sheet:

Liquid cash: 430 CR
Shareholders money in total investment = 82%
Share of Short term debt = 14.5%
Share of Long term debt = 3.5%


For paying RS 250CR ($36.6 million) to Daum the following funds can be used
- Liquid cash for 430 CR can be used

=======================================================================================

Conclusion:

1. Its software business alone worth(11.6 RS/share) more the current market price(8.3 RS/share)
2. The stock is beaten because of the negative impression around the management
3. Force motors stock was also down for a long time because of negativity about management and "porinju veliyath", the famous value investor, took advantage of this and the stock proved to be a mulitbagger for him in few years.
4. Company has good liguid cash and Lions share of business investment coming from share holders
5. Strong Software Business from LGS with very respected client base. Strong digital business with cutting edge brightcome technologies and fortune 500 companies and household famous brands as clients.

In conclusion this a business I would like to buy because of huge potential for growth and also huge undervaluation of the business.

 

i dont understand what is happening with lycos. going down never ends.

 

Lycos team to visit Vizag
https://www.thehindu.com/news/national/andhra-pradesh/lycos-team-to-visit-vizag/article19898590.ece

"A team of professionals from Lycos Internet Ltd will be visiting the Fintech Valley in Visakhapatnam soon to prepare the ground work on setting up their facility. Lycos, the BSE listed MNC, has agreed in principle to be a part of the Fintech Valley, according to its CEO and Chairman Suresh Reddy. Speaking to The Hindu on Saturday over phone, he said, The progress made in blockchain technology by the Andhra Pradesh Government at Fintech Valley in Visakhapatnam is significant. The ecosystem will go a long way in helping business houses leverage on the emerging technologies of the day. We will soon be there, said Mr. Suresh Reddy. Mr. Reddy made these comments after having a series of meetings with J.A. Chowdary, Special Chief Secretary & IT Adviser to Chief Minister N. Chandrababu Naidu earlier and IT Minister N. Lokesh on October 20 over the company s partnership with the Fintech initiative. The digital marketing and services firm Lycos has operations in 60 countries across the world." View less

 

Hello Mr Reddy , can you please explain about your company > is it worth staying invested > your results and share value have no relation ship > How are your customers treating you ? are they fed up

 

The issue with Lycos is solved and now I believe the share is ready to move up.

The stock price were beaten down because of a court case Ybrant digital(parent company) was fighting with the rival company DAUM.

What was the issue - Ybrant(parent company) bought Lycos from Daum with 20 million dollars down payment and rest of the payment would be some X times the revenue. So the pending payment came out to be 36 million dollars.

Lycos refused to pay this amount on the grounds of manipulation of revenues by DAUM appointed Lycos CEO and hence files a court case.

They lost the case and court ordered to pay 36 million dollars to DAUM. Ybrant files bankruptcy to get time to file a counter case on DAUM.

Later bankruptcy court asked Ybrant and Daum to settle the case outside the court and moved Ybrant out of bankruptcy.

Then the US court appointed a sheriff to get the transaction done.

But Lycos Contributed only 1.2% to the overall profit and 5.6% to the net asset of Ybrant. So paying 250 Cr (36 million dollars) was a bad deal for Ybrant as well as the investors.

Finally court ordered Ybrant to hand over the share of Lycos it owned(56%) to DAUM.

So now the company has been renamed as Brightcom, which is their signature brand.

This court case was the reason of fear to beat down the share prices to Rs 5-6 and now this issue is solved the share price has a good chance to reach its intrinsic value of 60 Rs – 70 Rs at 10 PE.


“Comments and other perspectives are welcome”