Borislav Tonev

Rising India Inc (OTCMKTS:RSII) Pushed Up by Social Media Buzz

by Borislav Tonev September 1, 2014

If you try to open Rising India Inc (OTCMKTS:RSII, RSII message board)'s website, you'll see that it is disabled at the moment. If you check out the company headquarters on Google Inc (NASDAQ:GOOGL) Maps, you'll see that it's a residential house which, you would agree, isn't really the most appropriate place for the principal offices of a publicly traded enterprise.

The more research you do, the more unappealing the stock becomes. RSII's latest financial report, for example, is an absolute mess. Page 2 tells us that on June 30, 2013, the company was authorized to issue up to 250,000,000 shares. At the same time, it tells us that on the same exact date, there were 471,991,348 shares of common stock issued and outstanding. That, as you probably know, is not possible.

If the rest of the numbers on the same page are correct, the float has grown from just under 1.5 million shares at the end of the second quarter of 2013 to more than 65 million shares on June 30, 2014. On Friday, investors traded more than 108 million shares which means that it has most likely been boosted further since the end of Q2.

And while we're still on the subject of the latest quarterly report, we might as well mention the fact that RSII's balance sheet is absolutely terrible. Here's a summary of the most important figures (or lack of such):

  • cash: $0
  • current assets: $0
  • total liabilities: $837 thousand
  • revenue: $0
  • net loss: $34 thousand

As an added bonus, RSII's financial report also reveals that should the market price go up, there might be no shortage of people who can profit from it. It says that last year, some note holders converted an undisclosed amount of debt into a total of 445,490,000 shares of common stock. We probably don't need to tell you that if the ticker moves in the right direction, the aforementioned note holders might be tempted to unleash their holdings on the open market which will, in turn, have catastrophic consequences for the stock.

All in all, there's nothing that could really entice you into thinking that RSII is a good place for your money. Even the latest press release is now a month old. And yet, it would appear that there are people who are fanatically supporting the stock. In fact, lots of them seem to be spending way too much time on the message boards and various social networking websites talking about RSII and how it can go up. Some even reckon that a valuation of $0.01 or even $0.05 per share is not impossible.

In light of the facts and figures above, this does seem to be stretching the boundaries of what's reasonable a bit, but despite this, RSII's supporters' tactics appear to be working. During the last session before the long weekend, the ticker managed to gain a whopping 88% while generating a dollar volume of almost $365 thousand. It currently stands at $0.0034 per share which, if the figures in the latest report are correct, results in a market cap of just over $1.6 million.

Indeed, the optimism managed to push RSII in the right direction and the people who were touting the stock from the very beginning are probably pretty happy about themselves at the moment. But will there be anything to support the ticker in the longer run?

We'll let you decide.

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