VEF: Trading at an excessive NAV discount - ABG

Q2’22 NAVPS (SEK) -35% q-o-q and +4% y-o-y VEF trades at a 49% discount to NAVPS Solid cash position at USD 64.1m, 15% of NAV Q2’22 NAVPS (SEK) -35% q-o-q and +4% y-o-y
The NAV of VEF’s portfolio decreased with 40% q-o-q in Q2’22 to USD 441.2m. The NAV per share (SEK) fell by 35% q-o-q but is up by 4% y-o-y, to SEK 4.3 per share. The NAVPS (SEK) has been helped by favorable FX (SEK/USD), which is up 9% q-o-q. In the portfolio in Q2, it was primarily the write down of the two largest portfolio companies, Creditas and Konfio, where the fair value was written down with 50% and 55% respectively q-o-q, which drove the decrease of the net asset value of the group. The underlying drop in NAV is driven by the turmoil in financial markets where multiples for comparable listed companies have fallen sharply.

Trading at a 49% discount to NAVPS During the second quarter, VEF participated in a few follow-on investments; Juspay (USD 4.1m), Magnetis (USD 1.0m), FinanZero (USD 1.0m) and Abhi (USD 0.5 m). The total follow-on investments amounted to USD 6.6m in the quarter. Between Q1’22 and Q2’22, the NAVPS in SEK has fallen by 35%, while the share price has decreased by 48%. Following the last day of June, the share price of VEF has fallen an additional 5%. Given the latest reported NAVPS, we asses VEF currently trades at a 49% discount to NAV. Well above their five-year average of trading to a 20% discount to NAV (ABGSC calculation).

Solid cash position of USD 64.1m, 15% of NAV Following the issuance of SEK 500m of sustainability bonds in Q2, the cash position, including liquidity investments, stood at USD 64.1m. Given the debt issue, we assess the company has a solid liquidity position to support more deals and the current portfolio of companies in future financing rounds. We view the current discount level to NAV as excessive, especially since the company has built up an impressive track-record of growing NAV per share, up by a CAGR of 22% since inception. However, given the current ma ... Läs mer på ABG Sundal Collier

Länk till analysen i sin helhet: https://cr.abgsc.com/foretag/vef/Equity-research/2022/7/vef---trading-at-an-excessive-nav-discount/