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Rediff’s cash reserves at Rs 32.2 crore; Shares may be delisted in two quarters


Rediff.com had cash reserves of Rs 32.2 crore ($4.2 million) for the quarter ended December 31, 2015. The company had reported cash reserves of Rs 45 crore in the preceding quarter. MediaNama had first flagged the declining cash reserves last year, where, with losses of around $3M, it appeared that Rediff didn’t have more than four quarters of money left.

Total revenues for the company decreased 8% to $3.63 million from $3.96 million in the same quarter last year. Indian online revenues was at $3.15 million, down 5.97% from $3.35 million in the same quarter last year. However, the  operating expenses were down 9.52% year-on-year (YoY) to $2.85 million  from $3.15 million in the same quarter last year.

Marketplace fee revenue as a share of total revenues grew to 31%, compared to 24% in the corresponding quarter last year.

Operating EBITDA showed a loss of $1.94 million for the quarter as compared to operating EBITDA loss of $2.18 million in the corresponding quarter last year. Net loss for Rediff for the quarter was $1.86 million compared to net loss of $2.37 million in the same quarter last year.

Ecommerce focus

Rediff CEO Ajit Balakrishnan said that the total number of merchants on the online marketplace  increased to 2,030 from 1,863 at the end of the quarter ended December 31, 2014.  Listings increased to 11.3  million products from approximately 9.5 million in the same time period.

“In this quarter, we earned a margin, or take rate, of 30% on products purchased through our marketplace, as compared to 26% in the same quarter last year,” he added.

Rediff added that 39% of  marketplace transactions this quarter came from mobile devices, as compared to 25% in the corresponding quarter last year.

Delisting from NASDAQ 

On February 3, 2016 Rediff  received a letter from Nasdaq which said that for the previous 30 consecutive business days, the bid price for Rediff’s American Depository Shares (ADSs)  closed below the minimum $1 per ADS requirement for continued listing on the Nasdaq Capital Market.

Rediff added that it has 180 days to regain compliance. Failing which, the company will have another 180 days for achieving compliance provided it meets other listing requirements for market value if publicly held shares and all other initial listing standards for Nasdaq Capital Market.

Rediff will be exempted from the bid-price requirement but will have give a written notice of its intention to cure the deficiency in the second compliance period. If Nasdaq determines the company is unable to cure its deficiency, Rediff’s shares will be subject to de-listing from the bourse. Rediff’s shares can then be traded over the counter.

Earlier in August 2015, Rediff moved its stocks from the Nasdaq Global Market to the smaller Nasdaq Capital Market as it did not meet the stock market’s minimum equity level for continued listing on the Global Market.

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