Tag: vision fund

SoftBank may invest $10 billion in Indian startups in 2022, BFSI News, ET BFSI

Banking & Finance

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SoftBank Group Corp. can invest $5 billion to $10 billion in India next year if it finds valuations attractive, said Rajeev Misra, chief executive officer of SoftBank Investment Advisers.

“If we find the right companies, we could invest $5 billion to $10 billion in 2022,” Misra said on Thursday at the Bloomberg India Economic Forum. “If we find the right opportunities at the right valuation.”

So far, investments in India haven’t disappointed the Japanese giant with its portfolio of startups in the country sitting atop sizable gains in valuations. SoftBank is planning to raise the stakes in India — having invested $3 billion in 2021 — just as global firms grow more wary of bets in China with tighter regulations across a number of industries hurting deals there.

India has been a bright spot for SoftBank, whose Vision Fund reported a record loss of 825.1 billion yen ($7.2 billion) for the quarter ended in September, on the decline in value of public holdings such as the Korean e-commerce giant Coupang Inc. and the Chinese ride-hailing giant Didi Global Inc. The Japanese company invested early in the Indian market, taking a stake in ride-hailing giant Ola and e-commerce leader Flipkart, before its acquisition by Walmart Inc.

SoftBank also invested in digital payments pioneer Paytm, which is poised to raise $2.5 billion in its initial public offering. Oyo Hotels & Homes, also backed by SoftBank, filed preliminary documents for an 84.3 billion rupee ($1.1 billion) initial public offering in October.

India’s tech ecosystem is taking off and SoftBank’s patience will be “rewarded,” Misra said. “It is India’s time.”



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SoftBank dragged into red by falling Vision Fund valuations, BFSI News, ET BFSI

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SoftBank Group Corp reported a 397 billion yen ($3.5 billion) net loss for the July-September quarter, dragged down by a $10 billion investment loss at its Vision Fund unit as tech valuations fell.

While CEO Masayoshi Son describes SoftBank as a goose laying “golden eggs”, referring to its stakes in startups that go to market, initial public offerings (IPOs) have dropped off and shares in many top assets like online retailer Coupang fell during the quarter.

“The strategy of let’s create the perception of enhanced value by taking things public hasn’t really worked this year,” Redex Research analyst Kirk Boodry said.

Depressed valuations in SoftBank’s China portfolio amid a regulatory crackdown continued to drag with its stake in ride-hailer Didi, acquired for $12 billion, currently valued at $7.5 billion.

The group’s largest asset, Chinese e-commerce firm Alibaba, fell by around a third in the second quarter.

SoftBank’s quarterly net loss compared with a profit of 628 billion yen in the same period a year earlier.

Bright spots for the Vision Fund include its India portfolio with ride-hailer Ola and logistics firm Delhivery targeting listings.

SoftBank has been trimming stakes following the expiry of lock-up periods, while focusing on investing through its second Vision Fund that has $40 billion in committed capital from SoftBank itself.

SoftBank shares, which have lost around a quarter this year, closed down 0.77% at 6,161 yen ahead of earnings on Monday.

($1 = 113.3500 yen)



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SoftBank’s Vision Fund posts $2 bn profit, share weakness casts shadow, BFSI News, ET BFSI

Banking & Finance

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TOKYO: SoftBank Group Corp‘s Vision Fund unit on Tuesday posted a 236 billion yen ($2.14 billion) profit in the first quarter after gains from listing portfolio companies were offset by falling shares in firms like e-retailer Coupang Inc.

The Japanese conglomerate posted record annual profit in May with executives pointing to further upside from Vision Fund investments such as Chinese ride-hailing firm Didi Global Inc and “Uber for trucks” startup Full Truck Alliance Co Ltd.

Those companies listed in New York during the quarter but Chinese regulatory action has subsequently hammered valuations, underscoring SoftBank’s China risk even as the group seeks to reduce dependence on its largest asset, a stake in Chinese e-commerce giant Alibaba Group Holding Ltd.

While the crackdown has affected returns expectations, “our broader thesis in China is unchanged: It’s still a large, growing and compelling economic opportunity,” said Vision Fund Chief Financial Officer Navneet Govil.

The turmoil is clouding the outlook for the group, whose shares have slipped a third from two-decade highs in March amid the completion of a record 2.5 trillion yen buyback. Shares closed up 0.9% ahead of earnings.

“Having a large public portfolio introduces volatility but at the same time it allows us to continue to monetise in a very disciplined manner,” said Govil.

More than two-thirds of the portfolio of the first $100 billion Vision Fund is listed or exited. SoftBank has distributed $27 billion to its limited partners since inception.

Further upside will come from listings by Indian payments firm Paytm and insurance aggregator Policybazaar as well as Southeast Asian ridehailer Grab, which is due go public via a blank-cheque company merger, Govil said. SoftBank is also ramping up investing through Vision Fund 2, to which it has committed $40 billion of capital, with the unit making 47 new investments worth $14.2 billion made in the April-June quarter alone.

In the first quarter, Vision Fund unit gains included 310 billion yen from selling shares in investments including delivery firm DoorDash Inc and ridehailer Uber Technologies Inc.

First-quarter group net profit, however, fell 39% to 762 billion yen.

SoftBank has also been betting on publicly listed shares through its SB Northstar trading unit. It held stakes in firms worth $13.6 billion at the end of June with the portfolio no longer including Microsoft Corp or Facebook Inc listed three months earlier.



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