Near term items, page-35

Hi @axman,

You are absolutely right, no one has seen TSI India's balance sheet.

Few observations scolling back through the company's history...

If you refer to page 16 of the company's March 2013 Presentation below you will see a summary of TSI India's financials when the company were at 100%. Not sure if many investors may recall these important financials/metrics, but I do.

http://www.asx.com.au/asxpdf/20130325/pdf/42dvspw11v74dm.pdf

Here are a few metrics that have significantly changed since then...

1. The company had 1,040 ATMs on the market throughout India, with three high profile banks at the time.

Today, at 25% ownership, the company now has 14,000 ATMs on the market and is doing business with 35 plus tier 1 banks, various Utility companies and Institutions throughout India. With the implementation of recent agreements, TSI will become one of the largest operators of ATMs in India under management.

2. Debit Cards issued in FY13P was at 307 million.

It is now a little shy of 700 million. Debit cards are predominantely used at ATMs.

3. Number of ATMs installed throughout India in 2013P was 112,448.

It is now sitting at 230,000 ATMs.

4. TSI had a minimum threshold IRR of 23% for new contracts at the time.

We'll have to wait to see what that is today.

5. TSI India's revenue for Q3-FY13 was INR 124.5 million. What was highlighted is that growth was constrained by lack of capital and that as ATMs matured, so too would ATM metrics.

TSI India billed revenue data for Q2-FY-16-17 shows approximately 610,000,000 INR, which is equivalent to approximately A$12,003,384.80 at today's conversion rate for the second quarter.

6. TSI India's transactions for Q3-FY13 was 14.6 million.

TSI India's transactions for Q2-FY16-17 was sitting at 130 million.

7. TSI India's transactions per ATM per month for Q3-FY13 was 4,873.

TSI India's transactions per ATM per month for Q2-FY16-17 averaged out to approximately 3,095.

8. TSI India's EBITDA margins went from...

FY10 - 20%
FY11 - 21%
FY12 - 13%
FY10 - 3%

That was a massive drop. The company was finding it challenging imo. It was not long after that CX came in, as they needed to, if they were going to survive.

We may not know the full picture as yet, however Jonathon Howe's note is instructive. Look at the margins highlighted.

http://hotcopper.com.au/threads/chart.2788575/page-101?post_id=19402940#.WDpH2uZ97IX

The company is now at scale. We're now seeing an increase in the number of ATMs, an increase in the number of business relationships, an increase in business and business lines which should equal higher margins and fingers crossed profitability. The company recently highlighted that they have turned cash flow positive. I am very encouraged by that, particularly since all other business lines haven't even revved up yet. One other important point that I haven't forgotten mentioned in their latest Investor Presentation, is that each service can be independently marketed or collectively for increased pricing power. It's for all these reasons that I think the company is undervalued, but that's just my opinion and nothing else. Everyone needs to do their own research. For confirmation that the company is on the right track, we'll need to exercise a little more patience. I have plenty of that.

Tony