Japan’s SoftBank Group Corp’s Vision Fund investment arm reported a profit of $1.1 billion on investments for the first time in five quarters. It was driven by an increase in valuations of its public portfolio companies.
The Vision Fund investment unit, through which SoftBank invests in high-growth technology companies, reported the profit of $1.1 billion (on a standalone basis) in the June quarter.
SoftBank, however, reported a loss of $3.3 billion for the third straight quarter due to unrealised losses in some of its marquee portfolio companies, including China’s Alibaba.
investment strategy
The gain on investments is in line with its recent management commentary on adopting a more proactive investment and monetisation strategy. This will bring a much sigh of relief to start-ups as SoftBank hasn’t made a single investment in the last 15 months.
SoftBank’s Vision Fund reported a much smaller loss of about $2 billion. Between the two Vision Fund investment units, the fair value of SoftBank’s listed portfolio companies increased to $25.4 billion from $24.9 billion as of March 31 at the end of the June quarter.
The listed start-ups in SoftBank’s India portfolio – Zomato, Paytm, Delhivery and PB Fintech – cumulatively contributed gains of $400 million to the kitty of SoftBank Vision Fund 1 (SVF1) during the quarter ended June 30 (Q1 FY23).
While Paytm helped SVF1 gain $200 million during the quarter, Zomato and Delhivery added $100 million each to the fund in this period. The fair value of the SoftBank’s private portfolio companies, which is a major part of its investments, also inched higher to $61.3 billion, as of June 30, against $60.5 billion a quarter ago.