Will Sevak's latest change of name and leadership spice up investors' returns?

THE haphazard changes at mainboard-turned-Catalist-listed Sevak Ltd over the years have been dizzying. And more changes are about to come.

On Friday, Sevak's shareholders are set to vote on a proposed name change to "Digilife Technologies Limited" to reflect its digitalisation strategy and move into the tech space. The firm, majority owned by founder and chairman Bhupendra Kumar Modi, distributes mobile prepaid cards in Indonesia, provides ICT services and manages a battery electric vehicle fleet with ride hailing firm Grab in Singapore.

With a topline that has shrunk by about a third in the last five years to S$264 million in FY2020 when it sank into the red - just one year after it returned to the black and scampered out of the Singapore Exchange's watch list - a substantive refresh appears to be overdue.

But this name change to "Digilife" can hardly be viewed as bringing its A-game to investors. For one, it sounds rather bland at this point of the whole tech evolution.

Secondly, it has not been paired with a well articulated business direction, except that the firm is carrying out "pilot projects in the space of Fintech, IoT, Big Data and software solutions.

But here's the rub - this marks the firm's fourth name do-over in some 10 years. That's way too many, even for a company that has been listed on the Singapore Exchange for more than two decades.

Much ado about a name

The firm started out as MediaRing, an Internet protocol services firm. After India's Spice Group, led by Mr Modi, bought out the firm, it was called "Spice i2i" from 2010 as it expanded its Indian presence and ventured into mobile handsets and Internet solutions, hoping to tap the "youthful market" across the Israel-to-Indonesia belt (hence i2i, get it?).

While the name change was easy to justify as Spice was then a recognisable brand in the subcontinent, the firm quickly grew tired of it and replaced it with "S i2i" a year later, which followed the acquisition of Indonesian mobile player Affinity Group.

Fast forward seven years, the company would call itself Sevak - a Sanskrit word for "service" to reflect its corporate culture. That too has become a short-lived novelty as it now seeks shareholders' nod for another fresh identity.

So, it was perfectly understandable when the Securities Investors Association Singapore (Sias) raised the topic last week in its suggested list of questions for shareholders to ask the company at the forthcoming meeting.

"Can the board help shareholders understand the necessity to change the name with such frequency? While it is important to finetune the group's strategy in response to market changes, a good strategy (and name) should have a sufficiently long runway and not be time-limited," said the advocacy group, pointing out that tech giants Apple, Microsoft and Facebook have not changed their names even as they moved into new areas and diversified.

Shuffle & unshuffle

Sevak's countless boardroom shuffles (and unshuffles) is another curious thing that has left the board on several occassions in a limbo - be it in terms of size or independence factor and by extension, overall effectiveness.

Mr Modi has been Sevak's on-and-off chairman twice since 2009. In 2013, he handed his chairmanship to his son, only to be back on the saddle in 2015. The cycle would repeat itself in 2018 - he stepped down citing personal preoccupations and then rejoined the board in March 2020.

Outstaging that is the revolving door of the C-suite involving the firm's chief executive since 2010, Maneesh Tripathi, an IT veteran who has been in and out of Sevak's board more times than one cares to count and in March 2020 resigned from the top spot to helm the group's holding company instead.

But breaking up is hard to do, more so in hard times and as the pandemic-led lockdowns hurt Sevak's business, Mr Tripathi's one-month- long transition to stay on as CEO stretched to a year.

Early this month, Sevak announced that Mr Tripathi has ceased to be CEO and will hold key positions in the group's affiliate and holding companies. He is succeeded by Mayank Vishnoi, previously the firm's chief strategic officer for less than a year, with no experience as a director of a listed company.

Mr Vishnoi's short stint at Sevak and the recent senior management and board changes at the firm prompted SIAS to ask if there was "sufficient stability and continuity to provide a steady hand to lead the group during this critical period". On its part, the SGX too recently queried the nominating committee (NC) on its assessment of Mr Vishnoi's suitability as CEO, to which the company pointed to his "experience in strategy, corporate finance and capital markets in Asia".

While the jury is out on how this relatively new team will fare, the constant changes at Sevak, whose businesses have been upended by the pandemic, must be wearying for investors. Sevak needs a fresh story to imbue hope, but the company must stretch its imagination beyond seemingly inconsequential tweaks.