SoftBank, Vision Fund Portfolio Companies' IPOs Boost Value

Focus on Innovative Technology... 1.8 Trillion Yen Investment Profit in Q4 Last Year

[Asia Economy Reporter Minji Lee] SoftBank is expected to see a significant increase in investment value this year as its Vision Fund portfolio companies achieve successful IPOs.

According to the financial investment industry and Hana Financial Investment on the 11th, SoftBank recorded a net profit of 1.17 trillion yen in the fourth quarter of last year (October to December, fiscal year Q3). Total investment gains reached 1.8 trillion yen, marking a substantial turnaround compared to the previous year's net profit of 55 billion yen, which was affected by losses from Vision Fund investments.

Jaeyim Kim, a researcher at Hana Financial Investment, said, “This atmosphere clearly proves the results of SoftBank Chairman Masayoshi Son’s investment philosophy and aggressive investment strategy,” adding, “The value of the Vision Fund and SoftBank’s own investment assets increased, and realized gains from some sales also rose.”

The successful IPOs of companies included in the Vision Fund portfolio have led to a sharp increase in the value of Vision Fund investment assets. The DoorDash investment of $680 million rose to $9 billion as of the end of last year, yielding an investment return of over 13 times. The Opendoor investment of $450 million surged to $1.7 billion, resulting in a fourfold return.

Researcher Jaeyim Kim explained, “The overall investment return for companies that went public after Vision Fund’s investment is 2.6 times,” and added, “We recorded high realized gains by fully divesting stakes in some companies such as Slack, Ping An Good Doctor, and 10x Genomics.”

Based on cumulative figures from the first to third quarters of last fiscal year, the Vision Fund achieved realized gains of 210 billion yen, a significant increase compared to 14.6 billion yen in the same period the previous year. Vision Fund 2’s portfolio includes 28 companies, with 11 in the waiting stage. The investment return from IPOs following Vision Fund 2’s investments reaches 4.7 times.

This year, many Vision Fund portfolio companies, including Coupang, China’s leading ride-sharing service Didi, and ByteDance, the parent company of TikTok, are expected to go public. Accordingly, further profit realization through additional sales is anticipated. Moreover, additional gains are expected from currently listed Vision Fund companies such as DoorDash, Uber, and Opendoor.

Share buybacks are also expected to be a factor in further stock price increases. Of the total 2 trillion yen share buyback plan announced in April last year, 1.03 trillion yen had been executed by the end of January this year, with the remaining 700 billion yen expected to be completed before July.

Researcher Jaeyim Kim said, “SoftBank is a tech-focused investment company and reacts sensitively to investment sentiment in the tech industry, but the current net asset value based on the value of its investment assets has not yet been fully reflected in the stock price,” adding, “While short-term profit-taking is possible, a sustained upward trend is expected.”

This content was produced with the assistance of AI translation services.