Hi @Deven I am new to the forum, thank you for starting this thread. I am one of the investor in EMT since over a year and would like to continue holding my positions.
Following are my thoughts on the recent acquisitions of different business verticals:
- The company has 460 Crores of cash reserves as of March 2024.
- Since the main business of the company is the travel booking app which does not need capital expenditure to scale other than marketing costs as it holds a good market share.
- What do we expect for the company to do with the piling cash reserves?
- Ideally investing in the new age businesses would definitely makes sense to me.
Regarding the stake sale, currently we should not see that as a big red flag as the promoters still hold around 55%+ stake. I guess it is part of strategic dilution to welcome new investors to the group and for the promoters to take cash out of the company for their personal purposes and investing in other ventures. Most of the newly listed IPOs do the same in the next 3-5 years post listing. After all promoters had put such a big efforts to build the company from scratch to IPO and it is obviously their time to take cash out of the business to diversify their portfolio.
Regarding the bonus issue, I see it as a smart move to distribute cash as bonus equity rather dividends which are taxed heavily. The cash stays within the company and also shareholders benefit in the long run as we sail through the growth of the company.
Please let me know if I had missed anything obvious. Thanks
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