Hi TSN newbies,
I highly recommend all newbies start with the reading the Independent Research Report dated March 2014 below.
* Corporate History/Overview - Refer to pages 1 & 2 below.
http://tsnltd.com.au/wp-content/uploads/2011/08/TSN-Research-Report-March-2014.pdf
* Once you've read the report, refer to my post below.
http://hotcopper.com.au/threads/sum...719065/page-263?post_id=17310038#.V1gNyvl97IU
* TSI India - The company has already established strong sound relationships with major Indian banks, Utility Co's and Financial Institutions - As per company website
http://www.tsiplc.com/our_clients.asp there are 9 'key clients', however if you take note of the May 2015 Corporate Presentation there are a few more high profile clients not included on the company website. Presentation highlights that TSI India are serving over 230 million plus customers on their databases collectively. Note, with recent Mphasis agreement TSI India's bank clients alone are now 30 plus banks and that collective database is most likely over 500 million customers (refer to my and Marty's post below)...
http://hotcopper.com.au/threads/ann...2782036/page-16?post_id=17917007#.V1gMVPl97IU
http://hotcopper.com.au/threads/questions.2774858/page-66?post_id=17864038#.V1gKDvl97IU
* CX Partners own 75% of TSI India.
* TSN now has a 25% equity interest in TSI India's business.
* CX Partners are funding the entire ATM/Bill Payment business as a result of the approximate 75%/25% deal. Refer to the May 2015 Corporate Presentation dated 15/05/15.
* TSI India projected to achieve gross recurring revenues of A$53 million for financial year 2017. Refer to May Operations Update.
* TSI India presently have 10,175 ATM machines on the market (2052 + 8123 ATMs) with an additional 3125 machines not yet factored as part of the contracts from September 2014 + 400 Bill Payment Machines. Refer to recent Half Yearly Report.
* TSI India projected to achieve close to 600 million transactions for just their ATM business for financial year 2017. Refer to my post below.
http://hotcopper.com.au/threads/ann...2782036/page-16?post_id=17917007#.V1gMVPl97IU
* TSI India has aligned its strategy with the Reserve Bank of India of 'banking to the masses' i.e., to bring in another 700 million people into the banking system.
* TSI India ATM Business - of the 200,000 odd ATMs currently on the market in India, TSI India now have approximately 6.5% market share or 13,000 ATMs that they are managing and operating in India. As a result they have moved up to become one of the largest operators of ATMs in India.
* TSI India Bill Payment Business - TSI India now have 400 Bill Payment machines in India (with 200 E-Kiosk contract awarded in July 2015). The Bill Payments business currently makes up approximately a little over 10% of TSI's business, good scope and potential for strong margins with strong opportunities for expansion, which includes the field of mobile payments.
* TSI India's objective is for a trade sale. Possible exit date for a trade sale is less than 3 months away if nothing has changed. Refer to announcement dated 16/04/13.
* If TSI India don't achieve a trade sale in that time window then an IPO is on the agenda. Refer to announcement dated 16/04/13.
* As per 2014 Annual Report, TSI India achieved cash flow positive level of sales from business operations. That was almost two years ago.
* TSI India is starting to win larger ATM contracts. Existing bank client relationships are rock solid. Many contracts have been renewed with existing bank clients. I've previously highlighted that on page 4 of the Independent Investment Research Report, the research team highlighted that according to TSN, banks are no longer looking to award contracts for less than 100 ATMs. That figure has now been bumped up to blocks of 500 plus, with an execution period of 6-12 months. New agreement has now kicked that ball out of the park with an 11,000 ATM win!
* Transaction fees approximately AUD $0.10c based on numbers taken from recent May Operations Update.
* AUD $18.5 million facility in place. The AUD $18.5 million facility was based on AUD $1 = 54 INR at the time. Refer to announcement dated 14/08/12. The company was able to secure this line of credit with only 815 ATMs at the time (refer to 2012 Annual Report). They had 100% ownership at the time but that ATM figure is now over 13,000 ATMs with new 11,000 contract win but at 25% ownership now.
* TSI India have measures in place to improve margins. Refer to my post below.
http://hotcopper.com.au/threads/sum...719065/page-263?post_id=17310038#.V1gNyvl97IU
* Share price today sits at $0.029c.
* We have a market cap today of approx $51.48M.
From the May Corporate Presentation dated 15/05/15...
* Banking Opportunities: Opportunity to offer 100 plus banks their new leading technology. ATM networks, systems, payment services, card issuance, card management and card products and mobile payments. That's a total of 7 opportunities that the company has yet to tap into!
* Payments Opportunities: Corporate payments, m-commerce, easy electronic solutions, banking and payment services. The stand out for me under this heading was that Corporates are seeking rapid deployment of new products and services to capture these markets immediately. In other words it's a HIGH PRIORITY focus for them!
The businesses that are up and running at the moment for TSI India are only:
* ATM deployment - managing and operating ATMs for 30 Indian bank clients = 13,000 ATMs.
* Bill Payment/Kiosks for 7 high profile clients = 400 Kiosks.
* One E-Surveillance contract for 500 ATMs with one bank.
Products that TSI have ready for the market (refer to company website):
* Card Products (pre-paid card instruments).
* E-surveillance asset business lines outside of ATM surveillance.
* ATM Power Management and asset business lines outside of ATM Power Management.
* POS Terminals.
* Smartphone Technology (e and m-commerce / remittances).
* Big data driven MIS Systems for Analytics.
* Card Issuance.
* Card Management.
* Payment Services.
LATEST AGREEMENT WIN FOR TSI INDIA AND MY PERSONAL THOUGHTS ON THIS AND THE BUSINESS MODELS/SOLUTIONS THE COMPANY HAVE READY GOING FORWARD....
* TSI India presently have 10,175 ATM machines on the market (2052 + 8123 ATMs) with an additional 3125 machines not yet factored as part of the contracts from September 2014 + 400 Bill Payment Machines. These are ATMs and Bill Pay Kiosks that are already on the market and operating!
* TSI India have signed an agreement with one of India's Top 10 largest and leading IT companies (Mphasis) open for TSI India to manage their existing 11,000 plus ATM fleet.
* This is important as it's now becoming evident that the company have an aggressive plan of not only winning new contracts, renewing contracts, but also moving towards larger size expedient ATM expansion. The leveraging power that TSI have for future business opportunities is enourmous. The foundations are in place. This latest agreement was an important signal to me that the company are active in looking to progress and expand this business expediently. The company have CX Partners by their side to them help leverage what they're aiming to achieve: strong expansion of the ATM side of business and they now have the funding and cash flow in place to help them materialise this objective and the contacts to reach a very very broad market.
* I believe this kind of agreement may only be the beginning. Do you think TSI wouldn't be able to 'replicate' this business model out across other potential companies with ATMs that are looking for an experienced ATM outsourcing company with a world class platform to manage these? This is a platform we are talking about that has just increased the size of ONE part of their business by 5.5 times its previous size!!
* There's nothing to say this same business achievement can't be replicated across to what TSI are working diligently on and towards with the current B-Pay Kiosk business model they are looking to present to other Utility companies.
* The there's the e-surveillance / power management side of the business. They already have these systems installed across many of their very own 2052 ATMs. Now they're also looking outside of ATM business lines.
* What's significant is how rapidly the company have been able to increase ATM numbers across ONE business line with ONE Partner. I wouldn't take this lightly folks. Based on what I've researched over the past 3 or so years, once the magnitude of this agreement sinks in, I believe it's truly going to blow the lid off the market imo. Not just the ASX but the HUMONGOUS space they're operating in. IMO, the company's current fleet could easily increase to 50,000 in a very short time if this agreement is anything to go by. For that we'll have to wait and see, but going from 2000 ATMs to 13,000 ATMs is not something that is achievable without an experienced world class team or technology. Also refer to Marty's post below.
http://hotcopper.com.au/threads/questions.2774858/page-66?post_id=17864038#.V1gKDvl97IU
TSN THE SHELL - 100% OWNERSHIP...
* TSN (the shell) - the company is reviewing numerous business opportunities to leverage the strong relationships they have formed over the years with clients and Indian market. Refer to the May 2015 Corporate Presentation.
* Interesting recent Seek advertisement for new TSN CEO position below.
http://www.seek.com.au/job/30972126
* TSN has no debt. Refer to latest Half Yearly Report.
* And as of the 29/01/16 TSN had cash of a little under $2 million dollars.
Trip back to 2010 - Refer to 2010 Annual Report.
* In 2010 TSN owned 100% of the ATM/Bill Payment business.
* TSN had achieved gross revenues of A$1.8M for Q210.
* 9 million plus transactions were going through the business per quarter = $36m transactions per year.
* They had about 370 installed ATMs in India.
* Share price at the time was approximately $0.038c.
* They had a market cap back then of approx $45M.
* Transaction fees were approximately AUD $0.15c.
* The company had no debt.
* And as of the 30/09/10 they had cash of A$4.5m.
MY VIEW OF THE COMPANY'S FAIR MARKET VALUE....
Based on current business alone I believe TSN should easily be valued at 8-10 cents today.
Now that TSI India have signed an agreement with one of India's Top 10 largest and leading IT companies open for TSI India to manage their existing 11,000 plus ATM fleet, my 'fair market value' is now sitting at $0.25c even without detailed specifics. The value for me lies in the world class technology the company have been working on for many many years. It is now revealing what's actually possible. Not potential but what's possible.
This is purely my opinion and why my attention remains on the company's bigger picture ie trade sale or IPO,
so please, please, please do your own research.
Hope this helps.
Tony
