Cyanconnode Share Discussion Threads

[multibagger] 25/1/2020 07:05

Anil tweeting with more detail on the Indore Project particularly with regards to revenue enhancement on a monthly basis apart from benefits to the Consumer, Discom and the Govt of India. The expected Return on Investment (RoI) is about 2 years from award - so even much better than what I thought. I get a strong sense that Anil is making a point to someone the tweet is directed at (? @ EESL) !!

Also found this presentation from Vikas Narwal, Indian Administrative Service (IAS) and head of the Indore presenting at the Regional Cooperation for Modernization of Power in South Asia earlier this week.



Starts of in ? Hindi (but there is a segment from 1:13 onwards in English) for a fair bit and then reverts.

Looks like delegates from the USA, Maldives, Bhutan, Nepal, Bangladesh and Sri Lanka were also there. So I am speculating that the Intellismart JV with EESL is mapping out its geographical footprint for expansion...here's hoping anyway !

And it looks like our Indore is the flagship project - fantastic publicity and recognition !

Fantastic work and congratulations to Anil and the CYAN team !

[emptyend] 23/1/2020 08:04

Good spot. The point with India is that proven tech, coupled with very swift payback on investment, is going to drive volumes. Supply "losses" in much of India are a serious problem - and one that managements will be pretty keen to address.

[multibagger] 23/1/2020 06:42

We are making excellent progress in Indore as per the following article from today - keynote address by Mr. Vikas Narwal



1.2 Lakh or 120k smart meters installed in just ONE YEAR based on RF technology - not GPRS !
Estimated savings of Rs. 40 crores in a year, on an overall project base cost of about Rs.96 Crores (from memory)
Which reflects a phenomenal Return on Capital/Investment - the savings alone will pay for the entire project cost in about/less than 2.5 years. And then of course, ongoing savings from stopping AT&C will actually generate additional revenues on a recurrent basis in the years to come.

A total "no brainer decision" for anyone having to make an infrastructure capital investment decision - and no wonder the Indian Govt is showcasing this as a testament to their Government's achievements.

What will be the RoI on Heathrow 3rd Runway or HS2 ? - will help put Capex investment decisions in perspective.

What is also highly pertinent is that this achievement was announced at an event jointly organised by US AID (US Aid for International Development) , World Utility Summit and the Govt.of India.

This ties in nicely with a plausible explanation as to why the GoI may be in a tearing hurry to proceed with (what Tilly has posted) in terms of upcoming tenders in Madhya Pradesh of 2 tenders x Rs 236 crores = Rs. 472 crores or approximately £52.44 million.

It is my opinion that the massive, well publicised success of the Indore smart metering project has revitalised and rejuvenated the whole Indian smart metering ecosystem. Indore has been the test bed for implementation on a large scale and lessons would have been learned in terms of barriers and workarounds for installation issues. Given that Indore is effectively a reference site, Discoms from all around India will have ready access to a tried and tested formula/roll out plan to implement smart metering.

Why would any bureaucrat be bold enough to try an "untested" solution - as he /she would have a difficult case to answer if things don't work out ? There was an old adage of the 1980/1990s amongst the IT/Software guys that "Nobody got fired for buying IBM" - IBM was virtually the default hardware equipment anywhere and everywhere they used computers.

In my opinion, we are not far off seeing a similar kind of governmental mindset developing in terms of the technology adoption behind smart metering rollout in India with CYAN. Play safe, and stick with a tested recipe !

" CYAN inside" Genus, L&T and HPL meters control approx 50% of Indian market share and about 250 million smart meters needed in due course !

Either way, CYAN are on the move in India IMHO much to the chagrin, denials and discomfort of resident corporate archaeologists/ex- Chief Editors of Pravda (pre Glasnost/Gorbachev) who are going to be in for a rude shock....

[bscuit] 22/1/2020 16:25

Didn’t move when I bought 10k worth recently so more to it I think

[sabre6] 22/1/2020 15:49

Somebody purchased £10,000 worth of shares this morning bodes well!

[bscuit] 22/1/2020 11:29

Something happening? up 10% today so far.

[fred splange] 16/1/2020 17:11

How's Thailand doing? on holiday, and these things matter:)

[tonys8] 16/1/2020 15:29

India jumped from 1 to 4 on the flag counter, hopefully the start of a growing interest from the subcontinent.

[sabre6] 16/1/2020 12:17

Fred old boy you have got it wrong his name is Multibagger not Hilarious

[fred splange] 16/1/2020 11:50

Saved a copy of this to requote to you. Hilarious.

[multibagger] 16/1/2020 10:50

My post on LSE thread about acquisition valuation:

I don't have a market figure in mind that would reflect the potential of CYAN at this point in time but it would be way above £30m. Therefore, considering a market cap of about £30m as being "fair value" for an exit would be premature IMHO.
Once we get to roll out / implementation in scale with the prospect of a recurrent, embedded revenue stream with solid margins in a country as big as India...people will come knocking to buy us up. That is the way it goes.

Acquirers value companies from different angles - financial metrics such as Discounted Cash Flow, Revenue/EBITDA multiple etc (I am no accountant) are just one aspect in the mix. They also take into account Intellectual Property, Brand Strength, Geographical footprint, market share, growth potential, existing partnerships and customer stickiness apart from quality of the management team. So the "intangibles/goodwill element" could form a big part of any acquisition of us, when the time comes and £30m won't touch the sides in my view.

On the CYAN website it is stated that JC has exited 4 or 5 companies, returning about £600 million + to shareholders. That would give him a solid track record, experience and expertise in this M&A area in my opinion.

So personally, my view is £30m is too low and the figure would be higher, much higher in a few years time.
I invest from an owner mind set and having to wait another 3-5 years is fine by me :)

I suppose people will be posting that by then the company won't exist by that time - but I am willing to take my chances :)

I can see your thinking/argument that given our market cap of about £5.5m, a figure of £30m would offer a return of 5.5x return and there's no shame in that. A profit being a profit and all that.

But to me it would be akin to selling the family heirlooms and silver to pay for the weekly shop !

[multibagger] 16/1/2020 07:22

This could get very interesting - Sabre6 you are on the money ;)

[multibagger] 16/1/2020 07:21

I have been thinking about this Rs.2.86 Trillion and that equates to about £31 Billion (Rs.92 = £1GBP) according to the internet.

What CYAN have stated in past Investor Presentations is that Aggregate Technical & Commercial (AT&C) Losses in India is in the region of about $32 Billion A YEAR. Now if you look at this massive Rs. 2.86 Trillion / £ 31 Billion number in that context - it makes eminent sense and essentially a "no brainer" to invest £31 Billion upfront - as this investment will pay for itself in a couple/few years, if makes a big dent in the reduction of AT&C losses - which seems to be what the Livemint article says is the main purpose.

I am of the view, that our Indore project (over 100k smart meter installations) which is the largest in India and a Reference site / Centre of Excellence has demonstrated that installing smart meters with "CYAN Inside" has increased revenue collection in the region of 25% or thereabouts from memory. This information was presented at last years Investor Evening. Check with CYAN, if you need to.

Maybe I am being over enthusiastic in thinking that the evidence and results from Indore re +25% revenue collection for utilities in Indore may have led EESL to think again. This could have led to the invitation to the IntelliSmart JV and the conference in November 2019. The Indian Govt after trying out a number of different models/partners/technologies, think that they have hit upon an ideal hardware + technical solution, which had so far evaded them. This is my opinion.

Also why the "planted leak " from the Budget proposal - Electrama Conference is BEFORE the Feb budget from LTIs post. So I would read it as a "coded message" to the Electricity Sector, that be ambitious in your forward planning and investment, as the Govt. is going to commit "helicopter money" in this sector. They don't want such an immense networking opportunity to be wasted. Such a massive rollout, in such a short time to have some prospect of working out will only come about, if the Govt is able to offer financial measures and incentives to rapidly increase capacity - across the whole Electricity sector including smart meters. All my opinion and speculation.

Even if out of this potential £31 Billion, we are told about, 50% is allocated to Smart Metering Roll Out, then we are looking at £15 Billion for starters in this segment of the whole Electricity Infrastructure project in India. And of course, to remind ourselves, that our OEM partnership is with the 3 of largest meter manufacturer in India who control about 50% of this market share.

So we are potentially in play for about £7.5 Billion over the next few/several years - a huge number, but not an unreasonable extrapolation in my mind or opinion, but I am sure you and others will form their own opinions.

[puffintickler] 15/1/2020 17:14

Having seen my stake whittled down to nearly zero I have decided to buy a bit more. More in hope than expectation but I would really hate to see a big recovery back to a 50% loss unless I had topped up.

[sabre6] 15/1/2020 16:30

Mark my words.
We are about to have BLAST OFF

[fred splange] 13/1/2020 15:34

-7.8% looks like a movement of sorts, lol

[bskiny1] 13/1/2020 14:52

900k+ sell and no share price movement....I guess delayed

[sabre6] 11/1/2020 10:12

Realist
The thoughts are once Cyan reach break even and the orders start to come in Cyan will start to look attractive. The former I don't think is to far off. I say this as I have been invested in this company since the days of Ken Lamb and like most are showing a considerable paper loss. All in my opinion but hopefully back in profit over the next two years, as always DYOR.

[emptyend] 10/1/2020 09:38

...perhaps they are....????

[realist1950] 10/1/2020 09:23

Can someone please enlighten me, as to why no other business has come in and made a predatory bid for cyan, given that in recent times they regularly touted an order book of some £100M ?

I appreciate that order book has recently fallen back to £40M (cough!) but you'd still think what with SMETS2 here in the UK that someone would be snapping up this company, would you not!

[realist1950] 10/1/2020 09:05

Amazing isn't it....just amazing....HOW that rate of cash burn has somehow miraculously slowed when it has really HAD to ?!

Has this new and prudent management of resources coincided with a probable failure to successfully raise via the regular route (ie the market). I don't know the answer to that, I'm just posing the question.

Funny how the company recently boasted how the staff numbers at the company had swelled yet somehow it is able to go on, week to week, on a shoe-string.

All in my opinion. ADYOR.

[owenski] 10/1/2020 08:56

The financial details in that recent contract win are sobering, CYAN, caught between a rock and a hard place, needing guarantees just to buy the bloody stuff. Nightmare.

They said - "as they move towards breakeven" - really? in what universe.