Orchard Funding Share Discussion Threads

[gbcol] 14/4/2023 12:08

CWA1 absolutely, I have contacted many of the companies that I invest in over the years and as far as I can recollect, Orchard is the only one that hasn’t replied. Often it is the CEO or a board member that takes the time to reply - and I’m talking about companies bigger than Orchard.

Maybe they aren’t set up to respond to shareholders and investors, in which case they need to sort it out. If lack of response is more general (including potential customers for example) then that is even worse.

[cwa1] 14/4/2023 11:54

That IS a bit disappointing to hear that they're just not replying at all to shareholders. I understand they can't give away anything sensitive-but NO reply at all is poor form IMO

[gbcol] 14/4/2023 10:53

Valuewinsout did you ever get a response from Ravi? I’ve never managed to extract a reply from him.


valuewinsout23 Mar '23 - 23:42 - 337 of 357

I've written to Ravi Takhar, the Orchard CEO today, to make the case for a share buyback. This would be highly accretive to shareholders. If he does decide to do this, we will probably all hear about it first via an RNS. If he writes back to me to decline my request, I will share the response.

[battlebus2] 14/4/2023 09:53

I’d doubt it by the minimal volume. Likely just fewer selling now. Long way back to realistic valuation imho.

[cwa1] 14/4/2023 07:36

Suspicious little blip up this morning. Has it been tipped anywhere/anyone seen anything?

[galles] 06/4/2023 19:34

True. And Ravi himself has said he and his family do see the dividends as an important part of their income so will want to maintain that as a minimum

[battlebus2] 06/4/2023 16:43

They will imho maintain the dividend. No history of not even during Covid.

[galles] 06/4/2023 16:22

It's just so unloved, let's say they maintain the final dividend as they did today with the interim, a dividend yield of over 7%. Not many about out there if you ask me

[galles] 06/4/2023 16:20

Thanks Bbus

[battlebus2] 06/4/2023 15:44

Yes in simple terms. . The more they lend the more they borrow. Most loans are short term 12 months or less. It’s the NAV that’s more important for valuation. Also the lease is in there.

[battlebus2] 06/4/2023 08:43

Broker has a 64p target

[cwa1] 06/4/2023 08:35

Nice to see the share price reacting positively to today's results which were, IMO, very solid if unspectacular and showing understandable caution throughout.

I think my dreams of an increased dividend at some point have been crushed ;-)

I wonder if there will be any publicity for these results anywhere? If not it may be quite some time before we hear any more...

[battlebus2] 06/4/2023 07:33

Results as I expected. 25% increase in PBT to 1.3 million, strong lending volumes offset lower margins. Loan book increased 36%. Increased costs and increasing interest rates didn’t help Discount to NAV is now 51%. As expected some areas didn’t perform well like school fees and caravans leaving insurance 90% of the business. Dividend maintained at 1p. Expects a tougher H2 but with excess loan headroom of 10 million I’d expect us to perform well. Still cheap as chips to me but DYOR.

[battlebus2] 02/4/2023 09:17

Midas tips S&U which while not a complete comparison it’s similar to ORCH so hopefully we are trading like them.

[battlebus2] 31/3/2023 14:29

I would say steady as she goes with some areas going better than others but in the main a good performance and likely a maintained dividend. Results can only be days away surely.

[cwa1] 31/3/2023 13:22

Do "we" expect interims next week? Last time results went in to April was back in 2016 I think.

Does anyone expect anything radical like a dividend increase? Or will folk just be pleased to see a "steady as she goes" type announcement with the dividend held?

Would be interested to hear what anyone's expectations for results are

[battlebus2] 27/3/2023 16:34

While I agree losing 30% of your capital isn’t good I’ve been investing in these micro caps for a long long time and this is par for the course, sometimes you have to live with the pain. I’m always prepared for that. When I see bad news then I’ll reevaluate.

[gbcol] 27/3/2023 14:54

Yes however the 30%+ loss on capital takes the edge off the divi a little bit!

If my calcs are correct Ravi raked in circa £1m in salary, bonus and divis for 2022 which against a market cap closing in on £8m seems disproportionate to me. I guess he can always rely on at least 54% of shareholders thinking that he is doing a good job though!

The lack of shareholder engagement is appalling. Despite assurances (albeit from unreliable sources), the December 2022 Mello presentation has still not been put up on their website. I’ll be interested to see if valuewinsout gets a reply to his enquiry above. I didn’t to mine.

At the bottom of the Investor Relations page it states “This information was last updated on 30 May 2019”, which is indicative if not totally accurate.

[battlebus2] 27/3/2023 11:54

We just need to be patient and see how the next update reads. I’m happy with the dividend as we go. Currently 7.5% at 40p.

[1tx] 27/3/2023 10:43

Sadly we are in two presently unpopular sectors.Consumer Finance & Smallcap,microcap in our case!We can only hope interims are positive;but overall punters are keener to sell than buy shares hence the continual mark downs...I consider this a well run company with a good business offer but few are interested.Looking throughout the sector even larger companies with a good record.Say S&U for example valuations are low.

[cwa1] 27/3/2023 10:02

And further down we trundle. It's all a bit dispiriting...

[battlebus2] 24/3/2023 10:50

Well done and said 👍

[valuewinsout] 23/3/2023 23:42

I've not seen anything change about the business, so the recent share price weakness may be related to the banking crisis in the US. However, Orchard Funding Group is a completely different business to most banks, and does not suffer from duration or interest rate risk since almost all of their loans are <1 year in duration.

I've written to Ravi Takhar, the Orchard CEO today, to make the case for a share buyback. This would be highly accretive to shareholders. If he does decide to do this, we will probably all hear about it first via an RNS. If he writes back to me to decline my request, I will share the response.

Despite the recent share price weakness, there is nothing to my knowledge that has fundamentally changed about the business, therefore with continued business performance, I expect a share price recovery in time. In the final results RNS released in Dec-23, the company forecast was for an increase in gross loans to >£90M.

[battlebus2] 23/3/2023 20:58

Always a risk with these small cap stocks with big shareholders, I‘ve been in a few over the years.