Member Info for Monkshood

No problem getting the full allocation with around 200K raised from retail (max of £500k allowed).

The short notice period with the carrot of potential new orders rather than something 'in the bag' would not have helped.

I had been using around 40p as a top up point, so with the finances looking solid now I took the opportunity to increase my holding by 50%. In practice it provided a good opportunity to reevaluate my other small caps as I had to sell some for the funds.

A comparative review of Bips/HDIV/NCYF

https://citywire.com/investment-trust-insider/news/james-carthew-soft-landing-vs-recession-weighs-on-bond-funds/a2423262

From Bloomberg-

Although there has been an increase in BTL in arrears with an increase in repossessions, homeowner mortgage repossessions dropped 19% from the first quarter to 610, which is close to historic lows.

There is an article in The Times today citing various vineyards saying, that due to favourable weather, it looks like this year should be a bumper harvest.

Yes, definitely going to get some. Just been looking at the best way to finance it, not too much cash in my small cap pot this year!

You only have to look at the number of orders that have been placed for new commercial aircraft to see that this income stream is set to grow. I think that the additional opportunities for defence contracts and other applications gives the potential for this to be a really strong growth story going forward.

What I don't understand is the cancellation and consequences flowing from it.

'It is proposed to cancel the Company's Share Premium Account'

Quite a large one at that (39% of issued shares). 13% discount to the closing price which is not too bad. I thought that they would do this in conjunction with news of an order but I guess that purchasers want to see the company on sound financial footings first.

There is a retail offer of £0.5M which is good - too many companies just seem to ignore our interests .

In all I think it will be well received and with any short term concerns on funding behind them I can see the share price quickly rising above the placing price.

Their argument is that as they generate 2x divi cover the excess after the divi allows the company to grow even without any placing.

However, I am sure that if the price went above nav then they would do a placing to reduce debt and then be in a position using the rcf to finance a further, more rapid, expansion of the portfolio. They prefer to do a placing above nav as they can then argue it is non -dilutive to existing share holders. I think that they still have an eye on moving up to the FTSE 100 which would also be facilitated by a £500M placing.

They are presenting at the AIC in London (and online) in October so it should provide an opportunity to question them on this.

BIPS will be presenting at the AIC conference in October.

A good opportunity to quiz the manager, it is live (in London) and online.

The Italian Government has announced it is proposing a windfall tax on Bank profits. Bips holds bonds of Unicredit and IntesaSanpaolo, Whilst the companies share prices have, understandably, fallen it is still not clear whether this will impact bond prices. Arguably, if the companies are profiting enough to be subjected to a windfall tax then the risk for the bonds is already considered very low so it should have limited impact.

Spain has also gone down this route and looks like other countries are following. it may turn out that the perp bonds are a better investment than holding the equity in a high interest environment as less scope for governments to skim off the payments (with the exception of the Swiss with its handling of Credit Swiss...)

For a while the nav has been steadily increasing by around 0.3p per week. After the latest interest hikes by the BOE and ECB the purchase yield must now be around 12% with a MtM of near 15%. Clearly there will be no problem covering the 2p per quarter divi, but I wonder if they will increase this (again) to avoid there being a very large final one next year, otherwise it could potentially be >6p .

Citywire quote JPMorgan as saying that at the current discount this will add 6.6% to the nav, although clearly the intention is more to reduce the discount to nav.

Some/most? of todays rise will be traders buying to arbitrage against the share buybacks so it remains to be seen how large an impact it has longer term on the share price. I agree though that it is a positive start.

In theory it should reduce the discount which is why they are doing it. It will also increase the nav (due to the discount to nav on the shares bought backs) although I think this is a bit of a fudge.

From the Annual Report -£200m to be committed to repurchasing PIP shares, which represents approximately 15% of PIP's current market capitalisation.

I thought that these looked quite promising. They curtailed still wine sales last year because of the poor 2021 harvest and they have only just started to sell the 2022 vintage for the still wines so there should be scope for plenty of growth in this segment.

Whilst some of the share purchasers of late look like RI's (2000 blocks to qualify for the discounts) the steady buying this week looks like there may be broader interest.

They really do need to provide some clarity around funding for the new winery though as I believe this is main drag on the share price.

An aside, but it is also worth noting that live cases have increased by over 10% from year end results - (from 351- 390 to the end of June)

Merchant is the non forward, fixed price sales - so the auction price - (obviously been quite profitable over the past year).

For your second question this may help-

https://www.sciencedirect.com/science/article/abs/pii/S0140988320300402#:~:text=The%20penalty%20from%20each%20supplier,ROC%20presented%20by%20a%20supplier.

Bloomberg-

Mortgage approvals picked up in June to the fastest pace since October, data from the central bank showed. That aligns with what we heard last week from Lloyds CEO Charlie Nunn, who noted the resilience of the bank’s mortgage customers despite higher rates.