Mobile apps maker OnMobile was in damage control mode as it faced shareholders for the first time since promoter Arvind Rao's alleged attempt to misappropriate funds came to light, CNBC-TV18's Vineetha Athrey reports.
The annual general meeting was full of promises -- promises to fix the problems, to bring back growth, and to boost investor confidence.
Ravindranath MR, shareholder, OnMobile, says that from the date of issue it's been falling and today it is at Rs 35 making a loss of 95% to investors who invested in the IPO.
Another share holder, Shivaprasad Krishnan, sais that no investor likes to make a loss and there's bound to be anxiety.
OnMobile's shareholders, who attended the company's AGM in Bangalore, did not pull their punches and the management, just three months into its recovery from a partial collapse of its corporate governance and the exit of co-founder Arvind Rao, had its hands full. First came assurances that the problem was being fixed, and measures were being put in place to ensure it does not happen again.
Mouli Raman, co-founder & MD, OnMobile, says that we have taken steps to unwind some real party transactions, induct more independent directors and also working with an independent consultant to look at all internal mechanisms.
Investor confidence, which has fallen as the share price plunged from over Rs 270 in November 2010, to below Rs 35.
“We will look at a share buyback. We don't know if it makes sense or not. We are doing a careful study of that,” says Raman.
As OnMobile picks itself up and dusts itself off, it has the support of Argo Capital, OnMobile's largest investor.
HH Haight, chairman of the Board OnMobile, says that some of Onmobile shareholders wish to exit, and small shareholders at that, and we will facilitate selling their shares in the market but it is very small. But Argo Cap is not selling. Fixing problems aside, the company has also chalked out plans to accelerate growth.
OnMobile says that its focus is now very clear -- people, products and processes. And this time it is working hard to blend the right values in, and also exploit opportunities in voice-centric products, especially in emerging markets like Latin America and South Africa.