SPV, Greentree buy TRG shares worth $34m

Clearing the rumours, TRG Pakistan (TRG) operations remain robust and will continue in the same manner. According to the company management, there will be no compromise on corporate governance.

Regarding the liquid assets at TRGI, the management said that $34 million worth of shares (49 million shares) of TRG Pakistan have been purchased by the Special Purpose Vehicle (SPV) named Greentree Holding, while another $85 million still remain with the SPV in the form of cash and deferred cash.

Assets at the SPV belong to TRG Pakistan and have been ring fenced legally to be used only in a manner to benefit the shareholders of TRG Pakistan. On IBEX, the management said that the revenue for FY22 is expected to stand in the range of $474 to $482 million, showing an increase of 7 to 9 per cent, compared with FY21 revenue of $444 million.

Adjusted EBITDA of the company is expected to stand at $69’to $70 million, increasing by 5 to 6 per cent, compared with FY21 adjusted EBITDA of $66 million.

For the first quarter of FY22, IBEX revenue stood at $108 million, flat on YoY basis. Even though the revenue from legacy business is being offset by increasing revenue from digital first client base, as the decline in legacy business stabilises, the management expects digital first client base to lead the revenue growth, moving forward.

The management also addressed the burning question of Afiniti’s IPO and said that it does not expect it to take place in 2022. After the change of CEO and a recent turn of events, largely the client base has remained intact and the company has not lost any major employee or customer.

Some clients have opted for a wait and see; however, as things settle down, the company expects the growth in revenues to return.

Afiniti’s total revenue for FY21 stood at $238 million, increasing by 190 per cent YoY against $82 million for FY20.

The company is currently handling more than one million interactions/day for 100 clients globally. Over 350 patents have been issued due to the large-scale and ongoing research and development investment.

The management believes that the estimating total addressable market for Afiniti will be difficult given it is a disruptive technology; however, for the future growth estimates, the company divulged that it does not plan to hire more people in the near future, as the hiring for future growth already took place before the change of the management.

Saroash Saleem is the senior analyst at AKD Securities