Daily Brief Financials: JPY, Hang Seng Index, IP Group PLC, Tetragon Financial Group Ltd/F, Vista Land & Lifescapes and more

• During the period under consideration, i.e. February 28th 2024 to March 29th, 2024, the USD/JPY pair fluctuated between 146 and 152 Yen per 1 Dollar.
• The MA-10 line at the beginning of the period considered was moving above the MA-20 line.
• From March 7th until March 22nd the MA-10 line trend changed and was moving below the MA-20. 

• The HSI INDEX is currently down for the 2nd week in a row and it is quite oversold on a WEEKLY basis.
• A temporary reversal could come as soon as this week or next week, but we don’t think this will mark a restart of the previous rally.
• Look at the 16250-16050 area to go LONG, this is the area where the index most likely will print a temporary bottom.

IP Group’s NAV declined by 13% in total return (TR) terms in FY23, affected by continued soft valuations across venture capital (VC) markets, as well as funding delays at some of its holdings. That said, management indicated that many of IP Group’s portfolio companies continued to make strong progress. Its maturing portfolio offers a number of potential NAV triggers and is now available at a wide 59% discount to NAV. We note that, as at end-2023, only 14% of IP Group’s portfolio was valued based on funding rounds completed more than 12 months ago and 46% of its private portfolio was valued by a third-party specialist. IP Group’s holding-level liquidity was solid, with gross cash of £227m (or 19% of NAV) and 87% of its portfolio holdings (by value) had a cash runway to 2025 or beyond.

Tetragon Financial Group (Tetragon) posted a 6.4% net asset value (NAV) per share total return (TR) in US dollar terms in FY23. Tetragon’s returns normally have a low correlation with broader markets, and therefore its FY23 performance was below the 26.3% return of the S&P 500 Index, which rallied on the artificial intelligence (AI) theme. Tetragon’s FY23 return on equity (RoE) of 5.5% was below its target of 10–15% pa. That said, its performance since listing was within the target range at 11.3%. Tetragon continues payouts to its shareholders, distributing US$83.6m in FY23 through buybacks and dividends (3.0% of opening NAV), with the dividend yield standing at 4.4%.

Lucror Analytics Morning Views comprise our fundamental credit analysis, opinions and trade recommendations on high yield issuers in the region, based on key company-specific developments in the past 24 hours. Our Morning Views include a section with a brief market commentary, key market indicators and a macroeconomic and corporate event calendar.

• Vista Land & Lifescapes