Proposed Directors of Tirupati Graphite explain why they have requisitioned an GM. Watch the video here.
It would be a bit strange for an investor to be informed enough to know about bad news before it lands, but not informed enough to know that his stock is undervalued to the extent that the bad news needed to take it down would have to be of Kaiju proportions.
I do both. I think the company is likely to be materially out of trouble and progress as time goes on.
But I invested at aroud 0.6 and I don't fancy 0.5 or 0.3 because of a shares for interest deal that appears to not have been explained to the shareholders who voted for it. I'm asking for positives but even Digittt can't seem to find any. I'm glad we're actually discussing things that matter though.
I'm interested in your take on the bond/share situation.
What do you think about Jaggers' point? Are these bondholders going to mercilessly crush the stock of a company that needs funds to develop and pay them back the much greater sum at maturity? Wouldn't they wait for a higher, more stable share price.
Also why did the shareholders vote for this, was it basically as you said that you were not informed about the real position so you assumed that it was this or bankruptcy? No one did research or demanded to know the real position?
But then the bondholders are getting less than they are owed, because the price will drop, and in that situation, it might not recover even with good news. And in the long term, that means Echo will find it hard to fund growth, which it needs to do to pay the bondholders back.
It would be a stupid move by the bondholders. They aren't getting discounted shares.
Yes, it's better for long term holders, but not for those like me who thought we were buying in low recently...
I suppose we will see. But all the stuff about issuing shares then ramping etc, in partnership with the banks etc, that's deramping guff isn't it? Isn't it?
'MH clarified at my prompting that it was "best endeavours" (I think we will all say best efforts is close enough). At which point I immediately highlighted that this hadn't been made clear at all to s/hers (and noted the secretary furiously scribbling notes...I'm sure it never made it into the official minutes!). The answers given before were along the lines as it's complicated and there are multiple debt documents that all interrelate...but it was never directly answered.'
Well, I don't like this one bit. I suppose they want to stay on good terms with the bondholders and their future credit rep; it doesn't necessarily mean anything shadier than that.
If the dark chatter is right, at least there should be a spike to get out on! I hope Ranger wasn't right about this though.
Surely the bondholders aren't going to ask for it now? What they'd get would immediately lose its value unless Echo released amazing news to coincide and wouldn't questions be asked in that case?
But more to the point MY investment would immediately lose its value! And yours of course.
I didn't find body language or content particularly convincing in the interview. Then again, cameras and interviews scripted by committee are awful things unless you are a professional performer. Some CEOs like Colin Bird are wonderfully compelling interviewees... I don't put much stock in interviews as a gauge of a company's prospects. MH did strike me at least as someone who could see the light at the end of the tunnel for Echo.
'read back to my best efforts thoughts on the notes interest election'
' is it written that effectively management need to make best efforts to get the approvals and if they don't get them then the noteholders cant' elect to take the interest in share'
My reading of the bond agreement, again, just from the plain English, not as a legal expert, was that 'subject inter alia to the Company having the required share issuance authorities in place' meant the agreement didn't commit us to issuing the shares if the company didn't have authority to.
I was surprised, a bit shocked that it was agreed; I asked you about that a while ago, if you remember. The conversation on the board at the time of the vote discussion seemed odd to me, I couldn't understand how people read it any other way than that it wasn't binding but subject to, and had suspicions about conversation being steered towards it being binding, in order to get the vote. Do you mean I was right and it wasn't necessary? Or if not what was the legal position exactly?
I liked the minimum share price before dilution, obviously, and the zoom call sounded good, but was disappointed (not surprised!) that the suggestions came to nothing and that management got what they wanted and shareholders got no concessions.
Not sure if you are talking about Ranger or myself, but you might notice that he was rather positive today. And I'm starting to have enough of the pieces of the puzzle fit together in my mind to start thinking that maybe, just maybe, I didn't make a terrible mistake investing in this company.
Fair, long-term holders may have a clearer perspective on that.
I suppose with the benefit of the doubt, we could accept Echo as a company that is doing a number of things right, held back by legacy debt. It just frustrates me that the threat of that debt could be fast receding even now, if more progress had been made. The scale of it makes it an urgent matter still; 2025 is not really such a long time away and seems much closer than it did in Spring, given the pace the company is moving at.
I do also want to say that Ranger is right in one thing: there is a tendency to be charitable to Echo and highlight that it is doing its best, that good decisions are being made. But none of us should really be interested in effort or forgiving of bad luck or even sensible decisions that don't ultimately pay off, not when it comes to an investment. I think Echo has had some bad luck or judgement with their timelines - I don't think they or we can afford much more of that.
The really, I have to say incompetent thing they did was to say '5 days' for the wells, then '15 days', then silence for months, then '4 wells' and not mention the other 6 or the workovers. And in between they land an RNS about issuing shares. The interview was awkward and the investor presentation was thin.
This seems like a company with potential, and sensible short term plans but no coherent vision; when they talk about growth, when they talk about a wider vision, they seem out of their depth. Perhaps that's just a sign of their focus on the matters in hand, the turnaround, but at some point they need to sell their ambitions; a compelling, fleshed out vision for the company's future will make the debt seem far smaller.
And the quality of writing on the website is a punctuation-free run-on sentence monstrosity. It's like something from one of those satirical essay generators. 'Active work programme to deliver resource growth and production increase through exploration and short term operational activities generating multiple catalysts for newsflow across the asset base.' . Careful all that high-velocity newsflow doesn't prang the asset base...
But thanks for replying to my concerns; I feel happier with this investment, because for all the small issues that have kept it at this level, there's nothing serious holding Echo back, that we know of anyway, nothing that even the most negative posters can identify.
I agree abzzba, but we haven't seen even... 10 percent of that so far? And it's been a long wait... we've seen, I think, lower gas production, higher oil production.
I also agree about the negative posters, though I think Ranger has useful insights and knowledge. One of the things that interests me is the posters on the other stock forum, you must have seen them?
Two posters dominate the Echo board and one especially seems to put a great deal of research into long, detailed, researched, half-truthful posts, which are certainly worth reading though they slant their calculations quite cleverly towards negative conclusions. Maybe it's just that the long fall has left Echo with some keen detractors but I do wonder - then again perhaps it's just pointless to speculate on that kind of posting.
This is all basically what I'd surmised from studying the figures, apart from the supply contract issue which I hadn't considered.
Yet I'm on balance optimistic, whereas you are extremely pessimistic; I suppose partly because I got in low and then averaged down lower - no offence to the long term holders but I will be happy with a sensible market cap given the debt and challenges faced, and then decide whether to hold as the recovery develops. I don't see any issues here to justify the company languishing at a 7 point-whatever million market cap forever, or going lower. And this is if they can't as I say, pull anything better out of the hat.
The worst case scenario actually still looks like a company gradually turning its fortunes around.