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Ebix started as a supplier of software and e-commerce solutions to the insurance industry. However, it branched aggressively into payment, logistics, e-learning, and travel services. My interest began in late 2018 due to the high (albeit debt-fueled) growth and heavy (50%+) exposure to India, which I saw at the time as arguably the world's most attractive emerging market.
Unfortunately, that
came with all sorts regulatory and geopolitical risks. I was
particularly critical of management's in the wake of the
pandemic, even as Ebix was planning to IPO its EbixCash payments
IPO in India. By April of 2020, I began warning about the debt
time bomb in combination with those moves. That pattern
continued through the summer of 2023, by which point the IPO was
years behind schedule, and my view was completely divergent
with the market valuation. The final nail for me came on the
morning of October 2nd 2023, via a forbearance
agreement with the lenders. The market initially took
that as a sign of relief, but my base case was already that
shareholders would be completely wiped out, and that was
eventually shown to be correct. EBIX stands as an example of
how early warning on managment BS can sometimes be the most
valuable facet of this service.