IP Group - Impact + innovation at a compelling discount

IP Group trades at 0.54x its rebased end-May NAV of 139p per share, down 17% from the year end NAV/share of 167p. This prices in the public market fall in Oxford Nanopore Technologies (29p off IP Group’s NAV per share in FY22 to date), while the private company portfolio saw fair value gains over the period. First Light Fusion mitigated the fall in NAV per share, with a valuation increase on achieving first fusion and management’s expectation of a substantial up-round still ahead. Critically, IP Group remains well funded, with £251m of cash and deposits, providing comfort that it can support key investee companies, drive value from its portfolio and take advantage of the downcycle for new investments. Management recognises that realisations are likely to be few and far between if the current market backdrop persists.