Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

SoftBank shares breach Y10,000, scale two-decade high, on record Vision Fund profit

Published 02/08/2021, 08:29 PM
Updated 02/08/2021, 11:35 PM
© Reuters. SoftBank Corp's logo is pictured at a news conference in Tokyo

© Reuters. SoftBank Corp's logo is pictured at a news conference in Tokyo

By Sam Nussey

TOKYO (Reuters) - Japan's SoftBank Group Corp shares climbed above 10,000 yen apiece on Tuesday, hitting two-decade highs, a day after the group's Vision Fund unit reported record profits as portfolio company listings accelerate.

SoftBank's shares were up 3.3% at Y9,800 at 03:56 GMT having earlier shot past Y10,000, the biggest intraday jump in two months. On Monday SoftBank reported a bounce back in the value of its portfolio after startups like home-selling platform Opendoor went public.

With equity raising running at record levels, major assets from the first $100 billion Vision Fund portfolio expected to go public include ride-hailing firms Didi and Grab. [L1N2JT0HC]

The Japanese conglomerate is "effectively owner of the most lucrative portfolio amidst an ongoing retail IPO frenzy," Jefferies (NYSE:JEF) analyst Atul Goyal wrote in a note, referring to initial public offerings.

Most of the value of the first fund is locked up in a small number of large assets, which also include e-commerce firm Coupang and TikTok-owner Bytedance, in contrast to smaller bets by Vision Fund 2.

Frothy markets have seen the value of many of SoftBank's assets, or "golden eggs" as Chief Executive Officer Masayoshi Son termed them on Monday, climb with the value of its assets standing at $221 billion at the end of December.

That is $37 billion lower than three months earlier after the share price of Son's largest "egg", Alibaba (NYSE:BABA), tumbled following the regulatory halt of the IPO of its fintech affiliate Ant in November.

"The explosion in market liquidity over the last 9-10 months has played a huge role and we believe SoftBank success correlates closely with how U.S. tech trades going forward," Redex Research analyst Kirk Boodry wrote in a note.

Japan's benchmark share index was trading at a 30-year high on Tuesday after Wall Street closed at an all-time high overnight.

© Reuters. SoftBank Corp's logo is pictured at a news conference in Tokyo

SoftBank "looks overvalued at current levels but we would expect a turnaround only if the tech market cools off," Morningstar analyst Dan Baker wrote in a note.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.