Member Info for Etotheipi

When I first read the RNS I thought it meant they were planning a tender offer, wishful thinking. They are not even committing to buybacks, just setting up the facility to so do like I think all other investment companies do. They've got £35m to spend and listening to the Edison interview (thanks for the link unhooked) it's been allocated, so not going on buybacks.

The good news from the RNS and the interview is that at least 6 out of 7 portfolio companies have completed funding rounds at or higher than previous valuations, maybe 10 out of 11. This seems to suggest that the NAV is going to be maintained or increased, hopefully not more that 8% when the catch up and performance fee are triggered.

I wonder if the market makers misread the RNS too as well as some watch list investors which then got the day traders and algorithms excited.

I'm overweight by cost in this IT, I think there's a great story and potential here, Seraphim are doing all they can to educate the market (interviews, newsletter, podcast). I'm hopeful that once the market turns the sp will rocket back to a premium and it'll be business as usual. Anyone buying and holding at these prices are probably going to make a lot of money.

Crocqman, there's also the Generation Space podcast on Spotify and probably other platforms.

So the journalist says "My guess is that after the board cut its dividend, a private equity player will pounce and buy the quality assets, especially its fast-growing Icelandic data centre business." So he is suggesting that DIG9 will sell all the quality assets and keep the poor quality ones, this doesn't make sense, the PE firm miight as well put an offer in to buy DIG9. I'd vote against any offer less than NAV.

RGL are a REIT and have to distribute 90% of taxable profits as dividends. I don't recall seeing any information about rental income declining or costs going up, so why would do you think they would cut the dividend?

I’ve topped and here’s why. Yesterday’s RNS.

82% debt is fixed at an average of 3.8% (this should be total interest/total debt but could be the average of each tranche’s interest rate which isn’t correct). So that’s £352 at 3.8% = £13.38m, that leaves 18% floating (say SONIA at 5%), £77m at 5% = £3.85m, so total interest payments are about £17.23m, 1.7% of NAV (£999m Dec 2022). At 10% this number would be £21.08, giving a rate of 5.2% of debt and 2.1% of NAV, not too bad and certainly doesn’t justify the discount.

The reported net initial valuation yield (NIY) is reported as 4.3% (of NAV?) so that’s £43m. If this can be counted as taxable profits (which it isn’t and is probably an over estimate) that gives a possible dividend of 7p, assuming there are 550m shares issued and using 90% of £43m the REIT dividend rules. As new homes have been constructed and rented out this year the NAV has probably increased and the NIY would have too. So I’m expecting an increase in the target dividend next financial year.

At the moment this is yielding a below inflation 5% but I think this is a really well run business offering affordable rented accommodation in an environment when it’s getting increasingly difficult to get a mortgage and there isn’t enough housing stock. I think that over time the discount will get to a premium, the dividend will keep increasing. Also, inflation will start to slow and eventually get close to the magical 2% seeing a reduction in the base rate. Worst case: wind up and sell the homes at a profit.

IMO, DYOR.

Matador78, you might want to have a look at OIT and RKW, investment trusts that try to identify good UK listed smaller companies and AIM shares. I hold OIT but not RKW, so far OIT has been worth the management fee. I got lucky with BCN, other than that I've been burnt by direct investments, EML is my final one where I should have sold half at 11p.

The fund manager fees are paid out of the fund reducing the NAV, you don't pay these directly.

If there's material information in the annual report on Monday that accounts for the sp drop then this might be insider trading.

"pretax profit plunged to GBP14.7 million in the recent half-year from GBP38.6 million a year ago.". Alternatively, PRSR are still making significant profits in difficult times.

"gain from fair value adjustment on investment property plunged to GBP5.8 million from GBP31.1 million". Given that the blame for wide discounts is the markets expectation that NAV will decrease, surely this is good news. Again the company are still making a profit on the property portfolio.

The best news is: "Rental income grew 22% to GBP24.2 million from GBP19.9 million.". That's why I'm invested in this trust.

In my opinion the business case for buying HGEN is only stronger than when I bought at IPO for £1. I topped up today.

Thanks for the suggestion WiseOwl, I notice the price is 8.75 on his video so already 13% up on the day. So his tip doesn't account for the early rise but may have helped the price later in the day and today.

Holding and hoping.

I've got a few private equity investment trusts, all on big discounts and mostly doing badly except this, NBPE and HGT. One reason for the wide discounts suggested by a guest on the money makers podcast is that the market is expecting the NAVs of PE IT to fall due to the reporting delay. He mentioned that OCI were going to be the first to report.

It's excellent news that the NAV has actually increased by 24%, not only for OCI but the other private equity ITs. I am really impressed by the speed at which OCI have produced the update, it can take others 2 or 3 months rather than just over 3 weeks.

I notice that this report (and almost all reports, if not all) don't quote dividend cover, does anyone know why?

Here's my calculation for HSL's dividend cover, I would very much like comments on whether this are correct or close enough.

I'm working off the RNS so no page numbers. I'm using the values from section 4 of "Notes to the condensed financial statements".

Net revenue profit: £9368000
No. of ordinary shares: 74701796

Net revenue profit per share: 936800000/74701796 = 12.54

Which turns out to the value labelled "Revenue earnings per ordinary share", omitting the all important word "net".

Dividend cover = 12.54/7*100 = 1.8.

Which is good.

The sp rises significantly on any good news coming out iof China, especially loosening of Covid restrictions. I'm expecting a big turnaround when restrictions are lifted and the Chinese economy starts moving again.

Trading in Revolution Beauty shares were suspend on 1st September, the CEO and Chair step down on 9th November. Nothing similar had happened at Wise, in fact the sp is recovering nicely. There is absolutely no comparison.

No, Oxford Nanopore is still listed.

So the trust announces guaranteed increase in future income plus backdate amounts and the share price goes down. I give up!

Captain Hindsight strikes again.

Up yesterday when the market was down, down a lot today when the market is up. Something strange is happening, I haven't seen an IT go this bad since March 2020.