TIDMSIHL
RNS Number : 2288W
Symphony International Holdings Ltd
11 December 2023
Symphony International Holdings Limited ("Symphony or the
"Company")
11 December 2023
Dear Shareholders,
-- Symphony International Holdings Limited's ("Symphony" or the
"Company") unaudited Net Asset Value ("NAV") at 30 September 2023
was US$362,310,346 and NAV per share was US$0.7058. This compares
to NAV and NAV per share at 30 June 2023 of US$403,587,911 and
US$0.7862, respectively. The decrease in NAV by 10.2% quarter over
quarter is due to a decline in value of unlisted investment,
particularly in the lifestyle and new economy sectors, and Minor
International Public Company Limited ("MINT").
-- Symphony's share price continued to trade at a discount to
NAV. At 30 September 2023, Symphony's share price was US$0.46,
representing a discount to NAV per share of 34.5%. This compares to
a share price discount to NAV of 47.3% at 30 June 2023.
We would like to highlight some of the key developments in our
portfolio companies during the quarter:
-- Minor International Public Company Limited ("MINT"): In 3Q23,
MINT reported a record-high third quarter core net profit of THB
2.3 billion, an increase of 13% y-o-y. For 9M23, MINT's performance
also reached an all-time high with core profit of THB 4.6 billion.
During 3Q23, MINT declared an interim dividend of THB 0.25 per
share as a result of its operating performance during the first
half of 2023.
-- Indo Trans Logistics Corporation ("ITL"): : The logistics
sector in Vietnam continued to face headwinds, which affected ITL
in Q3 2023. Management have indicated they have begun to see a slow
recovery with freight volumes and yields improving since September.
ITL's ports operations remain stable and the group is expanding
this part of the business.
-- WCIB International Co. Ltd. ("WCIB"): The school's enrolments
continue to be ahead of expectations, which is expected to drive
stronger profitability for the current academic year. Symphony
participated in a further capital raising during Q3 2023 with other
shareholders to fund further expansion and enhance facilities that
will allow for more student capacity.
-- Liaigre Group ("Liaigre"): The market remained challenging in
Q3 2023 for showroom furniture sales, particularly in Europe and
the US. Management expect the market for high-end furniture to
remain subdued for the rest of the year in these markets. Showrooms
in Asia have been less impacted and remain a key source of growth
within the group.
-- ASG Hospital Private Limited ("ASG"): Management continue to
execute on an extensive pipeline of organic and inorganic
opportunities to expand the business. The group reported double
digit revenue growth for the six-months ended 30 September 2023.
The integration and revitalisation of Vasan Health Care Pvt. Ltd,
which was consolidated in March this year and added approximately
90 eye-hospitals to the group, is on track with strong growth in
inpatient and outpatient admissions.
-- Meesho, Inc ("Meesho"): Meesho had the first profit after tax
quarter in the history of the company. It is also the first quarter
with positive cash flow leading to positive cash flow on a YTD
basis. The company saw Monthly Transacting User ("MTU") growth
despite a high base effect from the prior year .
MARKET OVERVIEW AND OUTLOOK
Economic growth and future growth prospects continued to diverge
amongst major economies. The United States continued to report
strong growth, where GDP in the third quarter came in at 4.9% on an
annualised basis according to the commerce department's Bureau of
Economic Analysis. This was driven by strong consumer spending and
a strong labour market. Meanwhile, although China's GDP grew by
4.9% in the third quarter, beating market expectations, Chinese
officials struck a cautious tone indicating domestic demand
remained weak. A modest cyclical rebound in exports is unlikely to
reverse the ongoing diversification of value chains away from China
and negative demographic trends. In Europe, Mario Draghi, the
European Central Bank president delivered a downbeat view of
European economic growth, forecasting a recession by the end of
this year. Moreover, Russia's invasion of Ukraine caused major
commodity markets to fragment, and geopolitical tensions in the
Middle East could make matters worse.
Despite two years of rapid economic growth, S&P Global
reported that India continues to show a strong upward trajectory
for the coming year underpinned by private consumption and
investment. India has become an attractive location for
multinationals that have contributed to strong foreign direct
investment ("FDI") flows, particularly into manufacturing and
technology. For example, companies such as Google and Meta, Inc.
have announced multi-billion dollar investments into India. By 2030
S&P projects that 1.1 billion people will have internet access,
more than doubling from the estimated 500 million internet users in
2020. India's GDP is forecast to rise from US$3.5 trillion in 2020
to US$7.3 trillion in 2030, making it the third largest economy in
the world.
The IMF reported that Thailand's economy is projected to grow
2.7% in 2023, slightly higher than 2.6% in 2022 as the tourism
industry slowly recovers post the pandemic. In November, the Thai
Government announced a 500 billion Thai baht (US$13.87 billion)
stimulus policy in order to boost the economy. The government also
announced visa free travel to visitors from countries like China
and India. Chinese tourists made up 11% of 40 million tourists in
2019, but in 2023 against a projection of 4.4 million only 2.5
million have entered the country so far. The government hopes that
these measures will bring in more tourists by the end of the
year.
Vietnam's GDP in the third quarter of 2023 grew by 5.3% compared
to the same period the previous year. The figure is an improvement
from the second quarter's 4.1% growth. According to estimates
released by the General Statistics Office ("GSO"), the economy
continued to be buoyed by the ongoing recovery in the tourism
sector, a brighter manufacturing outlook and improved exports.
National Assembly Chairman Vuong Dinh Huy said that Vietnam will
likely struggle to meet the official full-year growth target of
6.5% which is already down from the previous year's 8.02%.
While global macro-conditions reveal heightened risks, we
continue to work with our investee companies to monitor and guide
their progress during these tumultuous times. We believe they are
well positioned to grow despite the near-term volatility.
COMPANY UPDATE
Symphony's listed investments accounted for 14.5% of NAV at 30
September 2023 (or US$0.1026 per share), which compares to 14.7% of
NAV (or US$0.1158 per share) at 30 June 2023.
The value of Symphony's unlisted investments (including
property) comprised 89.9% of Symphony's NAV (or US$0.6342 per
share), which compares to 88.8% (or US$0.6980 per share) at 30 June
2023.
Temporary investments accounted for (4.4%) of NAV (or
(US$0.0310) per share), which compares to (3.5%) of NAV (or
(US$0.0277) per share), per share at 30 June 2023.
Symphony's share price continued to trade at a discount to NAV.
At 30 September 2023, Symphony's share price was US$0.46,
representing a discount to NAV per share of 34.5%. This compares to
a share price discount to NAV of 47.3% at 30 June 2023.
PORTFOLIO DEVELOPMENTS
HOSPITALITY
Minor International Public Company Limited ("MINT"): is a global
company focused on three core businesses: hospitality, restaurants
and lifestyle brands distribution. MINT is a hotel owner, operator
and investor with a portfolio of over 530 hotels under the
Anantara, Avani, Oaks, Tivoli, NH Collection, NH, nhow, Elewana,
Marriott, Four Seasons, St. Regis and Radisson Blu brands in 55
countries across Asia Pacific, the Middle East, Africa, the Indian
Ocean, Europe and the Americas. MINT is also one of Asia's largest
restaurant companies with over 2,600 outlets system-wide in 24
countries under The Pizza Company, The Coffee Club, Riverside,
Benihana, Thai Express, Bonchon, Swensen's, Sizzler, Dairy Queen,
Burger King, Coffee Journey and GAGA brands, as well as over 1,000
further outlets held through MINT's strategic alliances (i.e.
S&P and BreadTalk). MINT is one of Thailand's largest
distributors of lifestyle brands and contract manufacturers. Its
brands include Anello, BergHOFF, Bossini, Charles & Keith,
Joseph Joseph, Zwilling J.A. Henckels and Minor Smart Kids.
Company Update: In 3Q23, MINT reported record-high third quarter
core net profit of THB 2.3 billion, a 13% y-o-y increase over 3Q22.
For 9M23, MINT's performance also reached an all-time high with
core profit of THB 4.6 billion. During 3Q23, MINT declared an
interim dividend of THB 0.25 per share in respect of its operating
performance during the first half of 2023.
Minor Hotels reported 8% y-o-y core net profit growth,
increasing to a record-high third-quarter net profit of THB 1.7
billion. This growth was fuelled by strong results from its
European hotel business as well as operational improvement from its
Thailand hotels and Anantara Vacation Club. Europe achieved its
highest-ever third quarter RevPAR and Bangkok hotels outperformed
pre-pandemic levels. In 3Q23, MINT opened three new hotels and
acquired a luxury resort in the Maldives with a partner- ADFD.
Minor Food reported core profit of THB 584 million in 3Q23, a
47% increase from THB 399 million in 3Q22. In 3Q23 the total core
restaurant revenue grew by 4% y-o-y, attributable to top-line
growth of Thailand, Australia and Singapore hubs, together with an
increase in profit contribution from joint ventures. Leveraging
higher operating efficiency and effective cost management, 9M23
core EBITDA increased by 33% y-o-y to THB 5,060 million. Core
EBITDA margin increased to 21.8% in 9M23, compared to 18.9% in
9M22.
MINT has strengthened its balance sheet by reducing debt and an
increasing equity base resulting from continued improved financial
performance. MINT's net interest-bearing debt to equity ratio has
reduced to 1.05x at the end of 3Q23 from 1.17x at the end of
2022.
Mr. Dillip Rajakarier, Group CEO of MINT expressed confidence in
the full-year 2023 performance and further growth prospects. MINT
Group looks forward to strong year-over-year results in the next
few quarters, particularly driven by the hotel high season in Asia
during 4Q23 and 1Q24.
During the quarter, the value of Symphony's investment in MINT
decreased from US$59.5 million at 30 June 2023 to US$52.7 million
at 30 September 2023. The change in value is predominantly due to a
decrease in MINT's share price by 8.8% and a deprecation in the
onshore Thai baht by 2.7%.
LIFESTYLE/ REAL ESTATE
Minuet Limited ("Minuet"): is a joint venture between the
Company and a Thai partner. The Company has a direct 49% interest
in the venture and is considering several development and/or sale
options for the land owned by Minuet, which is located in close
proximity to central Bangkok, Thailand. Since the original
investment, several parcels of land have been sold to local
developers and a large piece has been used to develop the
Wellington International School in Bangkok. As at 30 September 2023
Minuet held approximately 186.75 rai (29.88 hectares) of land in
Bangkok, Thailand.
Company Update: The value of Symphony's interest 30 September
2023 was US$57.8 million. This compares to US$59.9 million at 30
June 2023 based on an independent third party valuation. The change
in value is predominantly due to a depreciation in the Thai baht by
3.7% during the same period.
Symphony's original investment in Minuet was $78.3 million.
Total distribution receipts from partial sales of land have
amounted to US$65.2 million. We believe, that barring unforeseen
developments, and given the development activity in the area, the
remaining land should enable us to realise proceeds well in excess
of the current valuation.
SG Land Co. Ltd ("SG Land") : SIHL, through a subsidiary,
acquired approximately 50% of the outstanding shares of SG Land in
a JV with JCK International Pcl ("JCK") (formerly Thai Factory
Development Pcl). SG Land owns the leasehold rights to SG Tower and
Millenia Tower, which are office buildings in central Bangkok,
Thailand. The lease for SG Tower expired at the end of October 2023
and the lease for Millenia Tower expires at the end of November
2025.
Company Update : SG Land continues to make regular distributions
to its shareholders. In addition to a distribution during Q2 2023,
a further distribution was made in Q3 2023 bringing total
distributions for the year to US$1.0 million. SIHL, through a
subsidiary, agreed to sell its interest in SG Land and expects to
complete the sale in Q4 2023.
Niseko Property Joint Venture ("Niseko JV") : Symphony invested
in a property development venture that acquired land in Niseko,
Hokkaido, Japan. Symphony has a 37.5% interest in this venture, The
Niseko JV sold 31% of the development site to Hanwha Hotels &
Resorts with a further 39% to a new joint venture company that is
equally held and being co-developed by the Niseko JV and the Hanwha
Group. The Niseko JV continues to effectively hold approximately
50% of the total site, which includes a 100% interest in one parcel
of land which is being held for future development and/or sale.
Company Update : The property market in Niseko continues to be
vibrant with a number of developments being launched and end-user
demand remaining strong. The coming ski season is expected to
result in strong visitor numbers and property sales.
The part of the site to be co-developed by the Niseko JV and the
Hanwha Group remains in the planning phase. We expect to accelerate
design and marketing work streams following the 2023/2024 ski
season.
Desaru Property Joint Venture in Malaysia : The Company has a
49% interest in a property joint venture in Malaysia with an
affiliate of Destination Resorts and Hotels Sdn Bhd, a hotel and
destination resort investment subsidiary of Khazanah Nasional
Berhad, the investment arm of the Government of Malaysia. The joint
venture has developed a beachfront resort with private villas for
sale on the south-eastern coast of Malaysia and that are branded
and managed by One&Only Resorts ("O&O"). The hotel
operations were officially launched in September 2020.
Company Update: The hotel performance continued to improve with
higher average room rates and longer lengths of stay in Q3 2023
y-o-y. Management has been successful in activating facilities for
banqueting and events, which has driven growth of F&B revenues.
However, weekday occupancy continues to remain below expectation. A
number of initiatives are being undertaken by management to address
this, including the enhancement of the resort's spa offering. The
preparation related to the launch of the private residences is
ongoing.
Symphony has invested an aggregate of US$58.8 million in the
joint venture as of 30 September 2023. The fair value on the same
date was US$24.3 million. This compares to a fair value of US$27.5
million at 30 June 2023. The change in value is due to different
assumptions used in the valuation for this investment.
Isprava Vesta Private Limited. ("Isprava") : is a company in the
business of construction, designing and sale of branded villas in
non-urban markets in India such as Alibagh, Goa and Kasauli. The
company is also in the in the business of renting luxury holiday
homes under the brand name of "Lohono Stays" and includes both
homes constructed and sold by Isprava and third-party homes in
India and overseas.
Company Update: Isprava closed the quarter with a strong order
book. The gross profit margin came ahead of budget by 10% due to
process enhancements, operational efficiencies and streamlining
vendor billing management. The company launched a firm-wide ERP
solution. At the close of the quarter, Isprava had 159 homes at
various stages of development which are on track as per the
original timeline commitments.
Lohono had 121 operational homes on its platform at the close of
the quarter. This is slightly below target due to the
rationalization of the portfolio as part of cost optimization
initiatives and included homes that had fixed leases and minimum
guarantees. However, in core locations, the number of operational
homes increased above target. Prudent cost optimization of direct
and corporate costs have led to increased contribution and EBITDA
margins for the quarter.
HEALTHCARE
ASG Hospital Private Limited ("ASG"): is a full-service eye-
healthcare provider with operations in India, Africa, and Nepal.
ASG was founded in Rajasthan, India in 2005. ASG's operations have
since grown to 149 eye-hospitals, which offer a full range of
eye-healthcare services, including outpatient consultation and a
full suite of inpatient procedures. ASG also operates optical and
pharmacy businesses that are located within hospitals. Symphony
invested in ASG in tranches from October 2019 through to July 2020
and subsequently acquired secondary shares in October 2021. In
2022, Symphony sold approximately a third of its shares at 2.4
times its cost of shares sold.
Company Update: Management continue to execute on an extensive
pipeline of organic and inorganic opportunities to expand the
business. The group reported double digit revenue growth for the
six-months ended 30 September 2023. The integration and
revitalisation of Vasan Health Care Pvt. Ltd, which was
consolidated in March this year and added approximately 90
eye-hospitals to the group, is on track with strong growth in
inpatient and outpatient admissions.
Symphony's net investment cost in ASG was US$3.7 million at 30
September 2023, which is after reducing net proceeds received from
the sale of shares amounting to US$17.0 million in 2022. The fair
value of Symphony's investment at 30 September 2023 was US$36.1
million, which compares to US$31.0 million at 30 June 2023. The
change in value reflects the improved performance of the business
and higher market multiples of comparable companies used in the
valuation of this business.
Soothe Healthcare Pvt. Ltd. ("Soothe"): was founded in 2012 and
operates within the fast-growing consumer healthcare products
market segment in India. Soothe's core product portfolio includes
feminine hygiene and diaper products. Symphony completed an initial
investment in Soothe in August 2019 and subsequently made
investments through convertible notes and securities from 2020 to
2023.
Company Update: Soothe's management has been successful in
improving margins by refocusing distribution to more profitable
channels and reducing costs. The rationalization of certain
distribution has had some impact on overall sales, but management
have reported positive momentum with the initiatives
undertaken.
Symphony's gross and net investment cost in Soothe was US$13.4
million at 30 September 2023. The fair value of Symphony's
investment on the same date was US$20.7 million, which compares to
US$19.5 million at 30 June 2023. The difference in value is due to
changes in certain assumptions used in the valuation for this
investment.
LIFESTYLE
Liaigre Group ("Liaigre"): was founded in 1985 in Paris and is a
brand synonymous with discreet luxury, and has become one of the
most sought-after luxury furniture brands, renowned for its
minimalistic design style. Liaigre has a strong intellectual
property portfolio and provides a range of bespoke furniture,
lighting, fabric & leather, and accessories. In addition to
operating a network of 24 showrooms in 11 countries across Europe,
the US and Asia, Liaigre has a Design Studio which undertakes
exclusive architecture and interior design projects for select
yachts, hotels, restaurants and private residences.
Company Update: The market remained challenging in Q3 2023 for
showroom furniture sales, particularly in Europe and the US.
Management expect the market for high-end furniture to remain
subdued for the rest of the year in these markets. Showrooms in
Asia have been less impacted and remain a key source of growth
within the group. Asian showroom orders for the nine-months ended
30 September 2023 are 70% higher than the same period a year
earlier. The interior architecture business is also a bright spot
for the business as the pipeline of projects continue to grow.
Symphony's gross investment cost in Liaigre was US$79.7 million
at 30 September 2023. The net cost on the same date, after
deducting partial realisations, was US$67.6 million. The fair value
of Symphony's investment was US$31.9 million at 30 September 2023.
This compares to US$43.5 million at 30 June 2023. The difference in
value is predominantly due to a decrease in comparable company
market multiples used to value this investment and trailing
12-month EBITDA for the company.
CHANINTR ("Chanintr") : Chanintr is a luxury lifestyle company,
based in Thailand, which primarily distributes high- end U.S. and
European furniture and household accessory brands, including
Liaigre, Barbara Barry, Baker, Herman Miller, Marquee, Minotti,
Bulthaup kitchens amongst others. Chanintr also provides FF&E
solutions for real estate and hotel projects. In 2019, Chanintr
launched a new program called Chanintr Residences which will
showcase custom-designed luxury residences as turnkey projects.
Company Update: In Q3FY2023 and YTD2023, Chanintr's sales were
down for both developer and residential projects compared to the
same periods a year earlier. Sales closed for the 9-months to 30
September 2023 were down 25% y-o-y, however, there are several
projects in the pipeline that will enable the company to partially
catch-up in sales for 2023 compared to last year. The company is in
the product development stage for sustainable luxury products and
will initially test the concept with ChanintrX Co and then extend
it via Martha Stewart and Chanintr Home brands.
EDUCATION
WCIB International Co. Ltd. ("WCIB") : Symphony entered into a
joint venture with WCIB International Co. Ltd. ("WCIB"), that
developed and operates Wellington College International Bangkok,
the fifth international addition to the Wellington College family
of schools from the UK. WCIB operates a co- educational school that
began operations in August 2018 and will ultimately cater to over
1,500 students aged 2-18 years of age when all phases are fully
complete.
Company Update: The school's enrolments continue to be ahead of
expectations, which is expected to drive stronger profitability for
the current academic year. Symphony participated in a further
capital raising during Q3 2023 with other shareholders to fund
further expansion and enhance facilities that will allow for more
student capacity.
Creative Technology Solutions DMCC ("CTS") : is a UAE-based
company that provides technology solutions to K12 schools in the
UAE and the Kingdom of Saudi Arabia ("KSA"). The company was
founded in 2013 to provide customized IT solutions to the education
sector, including hardware, software and training. Symphony made
its investment in CTS in June 2019.
Company Updat e: Symphony completed the sale of its interest in
CTS during Q3 2023 and received further related contingent amounts
in November 2023. The sale generated a net return per annum and
times the original cost of investment (taking into account dividend
distributions and contingent amounts received) of approximately
24.0% and 2.5 times, respectively.
LOGISTICS
Indo Trans Logistics Corporation ("ITL ") : was founded in 2000
as a freight-forwarding company and has since grown to become
Vietnam's largest independent integrated logistics company with a
network that is spread across Vietnam, Cambodia, Laos, Myanmar, and
Thailand. ITL has grown to national champion status in Vietnam with
over 2,000 employees across its business units and joint ventures.
ITL's strategic plans include supporting small and medium
enterprises in Vietnam and across the Indochina region. Symphony
bought the shares that had originally been held by Singpost, the
Singapore Post office, at a cost of $42.6 million for a roughly
28.6% interest. Following the sale of a small number of shares in
Q2 2023 to a strategic Asian logistics company (at 4.6 times
Symphony's cost of shares on a net basis) as part of a larger
secondary offering, Symphony's interest was 27.4% at 30 September
2023.
Company Update: The logistics sector in Vietnam continued to
face headwinds, which affected ITL in Q3 2023. Management have
indicated they have begun to see a slow recovery with freight
volumes and yields improving since September. ITL's ports
operations remain stable and the group is expanding this part of
the business.
Symphony's gross and net investment cost related to ITL at 30
September 2023 was US$42.6 million and US$35.3 million,
respectively. The fair value for Symphony's interest in ITL on the
same date was US$61.8 million, which compares to US$63.6 million at
30 June 2023. The change in value is predominantly due to a decline
in trailing EBITDA used to value this business.
NEW ECONOMY
Smarten Spaces Pte. Ltd. ("Smarten") : In November 2019,
Symphony invested in Smarten Spaces Pte. Ltd ("Smarten"), a
Singapore based SaaS (Software-as-a-Service) company that provides
software solutions for space management in commercial and
industrial properties. Smarten was founded in 2017 by Dinesh
Malkani and offers an end-to-end solution for workplace flexibility
on a single technology platform, to help businesses navigate the
new hybrid workplace. The SaaS technology includes four key aspects
- Desk Management, Workforce Rostering, Demand & Supply,
Expenses & Chargeback, and Asset Management; bringing together
key workforce and workplace considerations for a future-ready
solution.
Company Update: The adoption of the hybrid workplace model has
led to growth in user activity with clients including a number of
Fortune 500 companies . Smarten Spaces currently operates in over
30 countries, with significant traction in North America.
The Company has been faced with a restricted funding and has
therefore focused on cost reductions in order to reach a cashflow
neutral position. This has led to reduced resources for sales and
marketing and as a result the Q3 2023 ARR showed a modest increase
of 0.8% q-o-q. Symphony made a further investment in Smarten in Q3
2023 that amounted to less than 1% of NAV.
August Jewellery Pvt. Ltd. ("Melorra") : Founded in January
2015, Melorra is an omni-channel fast fashion Indian jewellery
company that introduces a fresh collection of new designs every
Friday. Melorra adopts a minimal inventory model that uses 3-D
printing technology to achieve just-in-time manufacturing to bring
products to market efficiently. The company currently has 24
operational experience centres across India.
Company Update: Melorra continues to pivot towards more
profitable channels, which include stores and marketplaces. As a
result, the company is reducing the focus on online channels, which
are are also more capital intensive. The stores have shown all-time
high gross margins on higher diamond sales, while the demand from
marketplace channels continues to remain strong. In the last two
months Melorra has successfully opened eight franchise stores
taking the total number of stores, including both company owned and
operated and franchise stores, to 31. The company plans to open an
additional 10 stores before 31 December. The company has been able
to reduce EBITDA burn by 76.8% from March 2023 by reducing
marketing spend and overall headcount. The company has a target to
reach 50 stores by March 2024.
Good Capital Partners ("Good Capital" or "GCP") and Good Capital
Fund I ("GCF1")& Good Capital Fund II ("GCF2") : GCP is
majority owned by brothers Rohan and Arjun Malhotra who have been
investing their own capital since 2014 to create a thriving
ecosystem of technology start-ups. Symphony announced its
investment in July 2019 with a 10% stake in GCP and serving as an
anchor investor in its first fund, GCF1 and in November 2022
committed to GCF2.
Company Update: Good Capital Fund I made no new fund investments
in the quarter. The Fund's cumulatively deployed capital is
currently US$12.2 million across 19 core fund investments and 58
Bharat Founders Fund investments ("BFF"), where the cheque size is
US$25,000. Currently, the Fund is in closing conversations for one
new core investment. At an aggregate level, the MOIC at the close
of this quarter is approximately 2.25x.
Good Capital Fund II made one new fund investment in the quarter
and is in the process of closing an additional five new investments
in Q4FY2023. The Fund's cumulatively deployed capital is currently
US$2.9 million across one core fund investment.
Catbus Infolabs Private Limited ("Blowhorn") : In August 2021,
Symphony invested in Catbus Infolabs Private Limited, the owner of
the Blowhorn platform. Blowhorn is a same-day intra-city last-mile
logistics provider headquartered in Bangalore, India. The company
provides seamless transportation, warehousing, and a fully
technologically integrated system to manage the end-to-end supply
chain process through an asset-light transportation and distributed
micro-warehousing network.
Company Update: The adoption of e-commerce and
direct-to-consumer business models in India is continuing to grow,
creating tailwinds for the logistics industry. However, due to the
challenging fundraising environment, the company has reduced cash
spending in order to extend runway which has led to LTM revenues
decreasing by -12% q-o-q. At the end of Q3 2023 the company
received funding from existing investors and is currently working
on securing further funding from external investors.
House of Kieraya Private Limited ("Furlenco"): Founded in
October 2012 in Bangalore, India, Furlenco is a residential
furniture rental services business. The business has since expanded
to include selling refurbished & recycled furniture; UNLMTD, an
annual furniture and appliance subscription service and KreateOne,
an in-house furniture manufacturing facility.
Company Update: Furlenco completed an investment by Sheela Foams
Limited in the quarter ended 30 September 2023. The infusion of
US$36.6 million has put the company on track towards meeting its
business plan targets. The company used the capital to reduce debt
and has started its marketing initiatives to grow the customer
base. The company is working towards achieving profitability
without compromising on growth.
Meesho, Inc ("Meesho"): Founded in March 2016 in Bangalore,
India, Meesho is a social e-commerce platform to sell to the next
500 million Indians coming online. Meesho is the most downloaded
app globally and is currently the third largest e-commerce platform
in India behind Flipkart and Amazon.
Company Update: Meesho had the first profit after tax quarter in
the history of the company . It is also the first quarter with
positive cash flow leading to positive cash flow on a YTD basis.
The company saw Monthly Transacting User ("MTU") growth despite a
high base effect from the prior year. Delivered orders grew due to
a decline in Average Order Value ("AOV") due to better pricing on
the platform. NMV has been growing due to significant reductions in
cancellations and Return to Origin ("RTO"). The company also
witnessed sustained improvement in its take-rate and an increase in
the gross profit margin.
SolarSquare Energy Private Limited ("Solar Square") : Solar
Square was founded in 2015 and is a rooftop solar power services
company that focuses on residential homes, primarily standalone
houses, gated societies, and small commercial centres. The company
aims to make clean energy affordable and accessible and become the
trusted brand in the space.
Company Update: The company had a strong quarter growing by 2x
over Q3FY2022 and is currently acquiring on average 550 homes per
month. By monthly volumes Solar Square is the number two player in
the market behind Tata Power. Cumulatively Solar Square has
acquired 9,000+ individual homes till now; each powered by an
average 3.5-4 kW of solar power. Each individual home which goes
solar saves an average of INR 45,000 per year in electric bills and
offsets 4 metric tons of CO2 per year. Less than 0.5% homes in
India have rooftop solar compared to 7% in Brazil, 15% in Germany
and 33% in Australia. The Government of India's pro-active
policy-making in the residential solar space will lead to further
expansion of the market in the years to come. Solar Square has
played a part in assisting the Government of India to shape policy
in this space.
MAVI Holding Pte. Ltd. ("Mavi") : In December 2022 Symphony
invested in Mavi, a B2B insurance and warranty programme
administration services company headquartered in Singapore with
operations in India, Thailand, and Singapore. Household wealth is
growing in South and South-East Asia with the middle class
expanding rapidly. Yet these regions are highly under-insured with
a lack of access to insurance products. Mavi is an early-stage
start-up business with a goal to develop insurance products that
are accessible, competitively priced, and tailored for the Asian
markets. The company will provide insurance and warranty programme
management services and partner with insurance and carriers in the
region to bring these products to market.
Company Update: Mavi continued to generate revenues in Q3 2023
through both the insurance business in Singapore as well as the
automotive warranty business in India. The Company is continuing to
build and secure partnerships for its insurance and warranty
services across Asia and has launched with an insurance provider to
bring Mavi's insurance products to the Indian market.
SUBSEQUENT EVENTS
Subsequent to 30 September 2023:
-- Subsequent to 30 September 2023, Symphony received proceeds
from the sale of the Wine Connection Group. Work is ongoing to
determine whether conditions for incremental contingent sale
proceeds have been met.
-- Subsequent to 30 September 2023, Symphony received contingent
proceeds related to the sale of CTS. The contingent proceeds
amounted to less than 1% of NAV.
-- Subsequent to 30 September 2023, Symphony funded capital
calls related to Good Capital Fund II. The total consideration was
less than 1% of NAV.
-- Subsequent to 30 September 2023, Symphony participated in a
capital raising for Catbus Infolabs Private Limited together with
other key shareholders. The total consideration was less than 1% of
NAV.
For further information:
Symphony Asia Holdings Pte. Ltd.:
Anil Thadani +65 6536 6177
Rajgopal Rajkumar
Dealing codes
The ISIN number of the Ordinary Shares is VGG548121059, the
SEDOL code is B231M63 and the TIDM is SIHL.
The LEI number of the Company is 254900MQE84GV5DS6F03.
Notes:
NAV takes into account the fair value of unrealised investments.
In accordance with the valuation policies of the Company, real
estate related investments are valued by third parties on 30
September and 31 December each year. In addition and in accordance
with the Company's valuation policies, investments that have been
held for less than 12-months are held at cost unless there is
evidence of a diminution in the value of that investment. Although
the investment manager believes there not to be a diminution in the
value of investments held for less than 12- months, the Covid-19
pandemic has led to a significant increase in economic uncertainty
which is evidenced by more volatile asset prices and currency
exchange rates and therefore cost may not correspond to an
appropriate measure of fair value in the current environment.
IMPORTANT INFORMATION
A more detailed Shareholder Update is available on request from
the Company and can be accessed via www.symphonyasia.com .
THIS DOCUMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION,
IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED
STATES OR ANY OTHER JURISDICTION INTO WHICH THE PUBLICATION OR
DISTRIBUTION WOULD BE UNLAWFUL. THESE MATERIALS DO NOT CONSTITUTE
AN OFFER TO SELL OR ISSUE OR THE SOLICITATION OF AN OFFER TO BUY OR
ACQUIRE SECURITIES IN THE UNITED STATES OR ANY OTHER JURISDICTION
IN WHICH SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL. THE
SECURITIES REFERRED TO IN THIS DOCUMENT HAVE NOT BEEN AND WILL NOT
BE REGISTERED UNDER THE SECURITIES LAWS OF SUCH JURISDICTIONS AND
MAY NOT BE SOLD, RESOLD, TAKEN UP, TRANSFERRED, DELIVERED OR
DISTRIBUTED, DIRECTLY OR INDIRECTLY, WITHIN SUCH JURISDICTIONS.
NO REPRESENTATION OR WARRANTY IS MADE BY THE COMPANY OR ITS
INVESTMENT MANAGER AS TO THE ACCURACY OR COMPLETENESS OF THE
INFORMATION CONTAINED IN THIS DOCUMENT AND NO LIABILITY WILL BE
ACCEPTED FOR ANY LOSS WHATSOEVER ARISING IN CONNECTION WITH SUCH
INFORMATION.
THIS DOCUMENT CONTAINS (OR MAY CONTAIN) CERTAIN FORWARD-LOOKING
STATEMENTS WITH RESPECT TO CERTAIN OF THE COMPANY'S CURRENT
EXPECTATIONS AND PROJECTIONS ABOUT FUTURE EVENTS. THESE STATEMENTS,
WHICH SOMETIMES USE WORDS SUCH AS "ANTICIPATE", "BELIEVE", "COULD",
"ESTIMATE", "EXPECT", "INT", "MAY", "PLAN", "POTENTIAL", "SHOULD",
"WILL" AND "WOULD" OR THE NEGATIVE OF THOSE TERMS OR OTHER
COMPARABLE TERMINOLOGY, ARE BASED ON THE COMPANY'S BELIEFS,
ASSUMPTIONS AND EXPECTATIONS OF ITS FUTURE PERFORMANCE, TAKING INTO
ACCOUNT ALL INFORMATION CURRENTLY AVAILABLE TO IT AT THE DATE OF
THIS DOCUMENT. THESE BELIEFS, ASSUMPTIONS AND EXPECTATIONS CAN
CHANGE AS A RESULT OF MANY POSSIBLE EVENTS OR FACTORS, NOT ALL OF
WHICH ARE KNOWN TO THE COMPANY AT THE DATE OF THIS ANNOUNCEMENT OR
ARE WITHIN ITS CONTROL. IF A CHANGE OCCURS, THE COMPANY'S BUSINESS,
FINANCIAL CONDITION AND RESULTS OF OPERATIONS MAY VARY MATERIALLY
FROM THOSE EXPRESSED IN ITS FORWARD-LOOKING STATEMENTS. NEITHER THE
COMPANY NOR ITS INVESTMENT MANAGER UNDERTAKE TO UPDATE ANY SUCH
FORWARD LOOKING STATEMENTS
STATEMENTS CONTAINED IN THIS DOCUMENT REGARDING PAST TRS OR
ACTIVITIES SHOULD NOT BE TAKEN AS A REPRESENTATION THAT SUCH TRS OR
ACTIVITIES WILL CONTINUE IN THE FUTURE. THE INFORMATION CONTAINED
IN THIS DOCUMENT IS SUBJECT TO CHANGE WITHOUT NOTICE AND, EXCEPT AS
REQUIRED BY APPLICABLE LAW, NEITHER THE COMPANY NOR THE INVESTMENT
MANAGER ASSUMES ANY RESPONSIBILITY OR OBLIGATION TO UPDATE PUBLICLY
OR REVIEW ANY OF THE FORWARD-LOOKING STATEMENTS CONTAINED HEREIN.
YOU SHOULD NOT PLACE UNDUE RELIANCE ON FORWARD-LOOKING STATEMENTS,
WHICH SPEAK ONLY AS OF THE DATE OF THIS ANNOUNCEMENT.
THIS DOCUMENT IS FOR INFORMATION PURPOSES ONLY AND DOES NOT
CONSTITUTE AN INVITATION OR OFFER TO UNDERWRITE, SUBSCRIBE FOR OR
OTHERWISE ACQUIRE OR DISPOSE OF ANY SECURITIES OF THE COMPANY IN
ANY JURISDICTION. ALL INVESTMENTS ARE SUBJECT TO RISK. PAST
PERFORMANCE IS NO GUARANTEE OF FUTURE RETURNS. SHAREHOLDERS AND
PROSPECTIVE INVESTORS ARE ADVISED TO SEEK EXPERT LEGAL, FINANCIAL,
TAX AND OTHER PROFESSIONAL ADVICE BEFORE MAKING ANY INVESTMENT
DECISIONS.
THIS DOCUMENT IS NOT AN OFFER OF SECURITIES FOR SALE INTO THE
UNITED STATES. THE COMPANY'S SECURITIES HAVE NOT BEEN, AND WILL NOT
BE, REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 AND
MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION
OR AN EXEMPTION FROM REGISTRATION. THERE WILL BE NO PUBLIC OFFER OF
SECURITIES IN THE UNITED STATES .
NEITHER THE CONTENT OF THE COMPANY'S WEBSITE (OR ANY OTHER
WEBSITE) NOR THE CONTENT OF ANY WEBSITE ACCESSIBLE FROM HYPERLINKS
ON THE COMPANY'S WEBSITE (OR ANY OTHER WEBSITE) IS INCORPORATED
INTO, OR FORMS PART OF, THIS DOCUMENT.
TO ENSURE THE COMPANY'S COMPLIANCE WITH SUB-SECTION 8(3)(A)(I)
OF THE PRIVATE INVESTMENT FUNDS REGULATIONS, 2019, THE DIRECTORS
WILL KEEP THE FINANCIAL SERVICES COMMISSION OF THE BRITISH VIRGIN
ISLANDS INFORMED OF THE NUMBER OF SHAREHOLDERS ON THE COMPANY'S
REGISTER OF SHAREHOLDERS.
THE COMPANY AND THE INVESTMENT MANAGER ARE NOT ASSOCIATED OR
AFFILIATED WITH ANY OTHER FUND MANAGERS WHOSE NAMES INCLUDE
"SYMPHONY", INCLUDING, WITHOUT LIMITATION, SYMPHONY FINANCIAL
PARTNERS CO., LTD.
End of Announcement
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END
UPDZVLFBXLLEFBX
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December 11, 2023 02:00 ET (07:00 GMT)
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