Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

<ul>
<li>Vision Fund's public portfolio lost $10bn in Q1 marking the third time in four quarters that valuation losses were in the tens of billions</li>
<li>Global tech weaness remains the main challenge as portfolio losses are matched with concerns on the private portfolio, especially ARM</li>
<li>And worries about ARM also feed into leverage concerns as Softbank's QoQ decline in reported LTV was driven by an ARM upgrade.  Meanwhile, CDS prices are near all-time highs</li>
</ul>


Vision Fund's public portfolio lost $10bn in Q1 marking the third time in four quarters that valuation losses were in the tens of billions
Global tech weaness remains the main challenge as portfolio losses are matched with concerns on the private portfolio, especially ARM
And worries about ARM also feed into leverage concerns as Softbank's QoQ decline in reported LTV was driven by an ARM upgrade.  Meanwhile, CDS prices are near all-time highs


Softbank Group - First Look at Q1 22 Performance

Articles from Caixin Global, Caixin Global

Caixin Global

Articles from Caixin Global

Caixin is a media group dedicated to providing financial and business news through periodicals, online content, mobile apps, conferences, books and TV/video programs. Caixin aims to blaze a trail that helps traditional media prosper in the new media age through integrated multimedia platforms.

News from Caixin

Cross Asset Strategy

<ul><li>In Depth: How SoftBank wrestled back control of Arm China</li><li>Analysis: China's 'zero-Covid' policy is here to stay despite relaxing of quarantine rules</li><li>Charts of the Day: China’s trade deficit with Russia balloons</li></ul>

In Depth: How SoftBank wrestled back control of Arm ChinaAnalysis: China's 'zero-Covid' policy is here to stay despite relaxing of quarantine rulesCharts of the Day: China’s trade deficit with Russia balloons

CX Daily: How SoftBank Wrestled Back Control of Arm China

Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Thematic (Sector/Industry)

<ul>
<li>Softbank has invested USD7bn in tech throughout Latin America since 3Q 2019, with 40% dedicated to fintech; we focus in on the listed fintech holdings, specifically Nubank and Banco Inter</li>
<li>In the 2Q22 market sell-off, we estimate that Softbank is holding 55+% unrealized losses in Nubank, with a similar level of losses on its more recent Banco Inter investments</li>
<li>These two neobanks have good client penetration but face profitability challenges; as a key shareholder, Softbank could push for transformative Nu-Inter M&amp;A, otherwise Softbank could seek to exit these investments</li>
</ul>


Softbank has invested USD7bn in tech throughout Latin America since 3Q 2019, with 40% dedicated to fintech; we focus in on the listed fintech holdings, specifically Nubank and Banco Inter
In the 2Q22 market sell-off, we estimate that Softbank is holding 55+% unrealized losses in Nubank, with a similar level of losses on its more recent Banco Inter investments
These two neobanks have good client penetration but face profitability challenges; as a key shareholder, Softbank could push for transformative Nu-Inter M&amp;A, otherwise Softbank could seek to exit these investments


Softbank (9984 JP) In Latin America: Focus on Fintechs and the LatAm Neobanks

<ul>
<li>Just as the December quarter was flattered by the last minute IPO of <a href="https://www.smartkarma.com/entities/sensetime-group-inc" target="_blank" data-smartkarma-citation="entities:34319:1" rel="noopener">SenseTime Group (20 HK)</a>, expiration of the lockup six months later has delivered a corresonding valuation hit</li>
<li>Vision Fund is still up on that investment but the public portfolio is flirting with a $10bn loss for the quarter depending on how US shares trade later</li>
<li>The discount has improved modestly to 49% from 51% but remains at the high end of the recent range as worries on tech valuations cast a long shadow </li>
</ul>


Just as the December quarter was flattered by the last minute IPO of SenseTime Group (20 HK), expiration of the lockup six months later has delivered a corresonding valuation hit
Vision Fund is still up on that investment but the public portfolio is flirting with a $10bn loss for the quarter depending on how US shares trade later
The discount has improved modestly to 49% from 51% but remains at the high end of the recent range as worries on tech valuations cast a long shadow 


Softbank Group - Expiration of SenseTime Lock-Up Has Lopped $1.5bn off the VF Valuation

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Event-Driven

<ul>
<li>Tencent sold US$3bn worth of SEA shares in Jan 22. The rest of its stake was locked up for six months.</li>
<li>The initial stake sale by Tencent didn’t go down too well and the stock is now trading over 63% below the deal price.</li>
<li>In this note, we will talk about the lock-up dynamics and recent updates.</li>
</ul>


Tencent sold US$3bn worth of SEA shares in Jan 22. The rest of its stake was locked up for six months.
The initial stake sale by Tencent didn’t go down too well and the stock is now trading over 63% below the deal price.
In this note, we will talk about the lock-up dynamics and recent updates.


SEA Lock-Up - Tencent Is once Again About to Be Free to Trim Its US$8bn Stake

Japan

SoftBank Group Corp. provides telecommunication services. The Company also operates ADSL (Asymmetric Digital Subscriber Line) and fiber optic high-speed Internet connection, e-Commerce businesses, and Internet based advertising and auction businesses.

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Softbank Group (9984 JP)

Softbank Group - First Look at Q1 22 Performance

Public valuation losses again exceeded $10bn as a last day meltdown for SenseTime marred an otherwise stable quarter for China. Global tech,...

Kirk Boodry

CX Daily: How SoftBank Wrestled Back Control of Arm China

In Depth: How SoftBank wrestled back control of Arm China. Analysis: China's 'zero-Covid' policy is here to stay despite relaxing of quarantine rules

Caixin Global

Softbank (9984 JP) In Latin America: Focus on Fintechs and the LatAm Neobanks

LatAm equity investments have added to Softbank's total equity value and rose to a 5% share in March; we expect this to go sharply into reverse at...

Victor Galliano

Softbank Group - Expiration of SenseTime Lock-Up Has Lopped $1.5bn off the VF Valuation

SenseTime's lock-up collapse has cost Vision Fund $1.5bn on the last trading day of the quarter, mirroring IPO gains when it listed six months prior

Kirk Boodry

SEA Lock-Up - Tencent Is once Again About to Be Free to Trim Its US$8bn Stake

Tencent sold US$3bn worth of SEA shares in Jan 22. The rest of its stake was locked up for six months, which will soon be over.

Sumeet Singh

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