The latest Investing Matters Podcast with Jean Roche, Co-Manager of Schroder UK Mid Cap Investment Trust has just been released. Listen here.
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We, as been said by us on a few occasions, are in around our 6th year+ in the stock and like you all are very disappointed with the performance of the SP, it should be trading at a discount to the NAV of around 10%. However it is not, so we have to decide whether to stay or go.
Well we are staying, that is not to say we would not sell some if it rose to 12-15p with our cost at 7.5p approx. from the early purchase at 17p. Our continued buying has reduced the average for us, like, we imagine it has for most long term holders by them adding stock to reduce their average.
Do we think it will go up (Seed), yes, but when depends on a number of things. The new wellness portfolio appears to be worth holding long term as it gives a variety to our I.T. holdings portfolio, but we would not hold the quantity we now hold as it is out of proportion to our other holdings. Seed is probably worth around 6-8p on wellness alone, subject to how you calculate figurers, it more or less covers our investment. The wellness section should grow considerably over time, with the SP following after it.
On top of this we hold Leap, which must be worth 5p plus (we hope). Making our overhaul investment look very secure at 7.5p
The next question being is what are the BOD doing with the Leap holding? promises of an early IPO has gone out of the window it would seem. They (the BOD) must make it clear what their intentions are with Leap, along with their reasons for that decision.
Do they think a delayed IPO will see an increase in value? or do they feel that continuing to hold Leap will see Seed benefit from future income along with the value of Leap. Then if disposed of what do they do with the cash from the disposal, no rash quickies in to un known territory. Perhaps a dividend would be nice for us.
So what ever they do, we feel our 7.5p costs are covered by the portfolio.
This defends our position of continuing to hold Seed. BUT the BOD need to start issuing information on what they intend to do with Leap, NOW and at regular intervals in the future.
What you feel you do with your holding is quite simply up to you and you should not be swayed by posts on this site, along with the continued bickering. Just use the information generally available.
Take care all and avoid posting comments about each other. No response may stop people saying nasty things, as what they write is ignored, as it should be.
O'Donnell, you know I love you, but I do quite regularly share a tracker of all SEED's investments, which is:
a) based on audited figures from last year end
b) adjusted for the Sept 22nd update, esp re cash balances and running costs
c) updated for all further investments in the portfolio / partial sales
d) inclusive of accruing interest on our convertible loan notes
e) reflective of today's share prices for listed stock and exchange rate
No need to speculate what proportion of our share price is made up from each part. Obviously, the unlisted investments are likely to be seriously undervalued on my sheet, as there's nothing tangible to tie any movements to. Share and enjoy:
https://we.tl/t-njCaHKPUfV
Today's NAV / share is 10.54p on the basis above.
Wow thanks very much for that, very helpful. Does the 10.54p NAV include yooma at 0.30CAD?
No problem. I put Yooma in at 0.24 CAD from its listing on CNSX and fx rate 1.7 CAD:GBP
If you download the sheet, you'll be able to work out what most of the calc's are / adjust them on your own copy as underlying investments move. It shows how much we overlook Eurox compared to Yooma, etc. just because there's so much more in the news about it. It's holdings like Eurox that'll make us rich...
Reefles, Your nav pretty much agrees with my version
I have not allowed any uplift for swb, NL, Eurox etc etc
Yooma as current sp
So imo huge potential upside from here
Hmm interesting, thanks
Good to hear we're in the same ballpark. We've had a couple of re investments in SW Brands, but at some point I also took a look at terms of loan notes. It's because I'm also directly invested in Northern Leaf, and saw that the 10% interest that accrues on the CLNs is at the holder's option to be carried into the conversion shares or taken as cash. So, SEED have already made about £40 of accrued interest on Northern Leaf since yearend, etc. Most of SEED's CLN's are similar, at 8 or 10%. Obviously I've only adjusted Leap by the re investment amount. It should be higher, and certainly no lower (given the base from last March is audited). We're showing a big loss on Yooma, but it's not that material to the portfolio. Still definitely double digits on NAV per share.
And for anyone who missed my post about cash recently... I would expect action on Leap very soon, given how little cash Ed has left himself in the kitty after funding Leap again (which is funding to pay for Leap to bring in independent investment advisors for their IPO / sale)
Have you heard any more about the SW Brands IPO? There was lots of talk in the Summer but it seems to have gone a bit quiet.
Nope, not on SW Brands. Was it Wadnob who used to update us on them? The Northern Leaf IPO is apparently on track (originally meant for "back half of 2021") but is awaiting more liquidity in the market, per James Innes at Chrystal.
On liquidity, I heard a rumour that Rhonda had sold her final 500k shares. (It wasn't a rumour, I made it up...)