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Backer of Ola and Paytm, SoftBank Vision Fund saw its losses balloon to $32 billion (4.3 trillion yen) in the financial year that ended March 2023, which is 68 per cent more than the $19 billion (2.5 trillion yen) loss recorded in the previous year.
The Japanese investor noted that “share prices of numerous public portfolio companies declined for the fiscal year amid the weakness in global stock markets.” SoftBank also saw the fair value of many private portfolio companies drop, as a reflection of the markdowns in weaker-performing companies and share price drops in comparable listed companies.
SoftBank’s investments
SoftBank Vision Fund 1 (SVF1) and SoftBank Vision Fund 2 (SVF2) sold investments (including those through share exchanges) for a total of $6.47 billion in the fiscal year, including full exits of ten portfolio companies, such as Uber and KE Holdings, and partial exits of several public portfolio companies.
Further, SVF1 and SVF2 made new and follow-on investments (including those through share exchanges) of $3.14 billion in the fiscal year, a significant reduction from $44.26 billion in the previous fiscal year.
Overall, SoftBank reported a loss of $7.19 billion (970 billion yen) in FY22. Gross performance since inception was an $11.4 billion gain in SVF1 and an $18.3 billion loss in SVF2.
The fair valuation of private portfolio companies of SoftBank Vision Fund stood at $60.5 billion in Q4 FY22 which is down from the $63.5 billion valuation in the previous quarter. This indicates valuation cuts in some of SoftBank’s private portfolio companies. In the case of public companies, SoftBank saw the valuation go up from 23.8 billion in Q3 to $24.9 billion in Q4 FY22.
Paytm stake sale
SoftBank has sold 2.07 per cent stake in One 97 Communications (Paytm) since February 2023 to comply with SEBI’s takeover regulations.
In a stock exchange filing, SoftBank said, “SVF India Holdings (Cayman) Limited has disposed of an aggregate of 13,103,148 equity shares of One 97 Communications Limited in a series of disposals undertaken between February 10, 2023 to May 8, 2023, with the disposal on May 8, 2023 breaching the 2 per cent threshold specified in Regulation 29(2) of the SEBI Takeover Regulations”
Post this share sale, SoftBank’s holding in Paytm has reduced to 11.17 per cent from the earlier 13.24 per cent. Reports have estimated the value of 2.07 per cent stake in Paytm to be around $120 million.
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