BP Marsh: NAV per share rises to 996p, but the shares still trade at a 32% discount

Up 1% at 676.4p (£244m) - Half-year Results

B.P. Marsh & Partners Plc (AIM: BPM), the specialist private equity investor in early-stage financial services businesses, announces its unaudited Group Half Year Results for the six months to 31 July 2026...

We already had an H1 update from BPM in September.

That day, I reduced our stance on the stock as it seemed to me that the growth at the main investee, Pantheon Specialty, was tracking a little below par. This single investment - where BPM owns 41% of it - is worth about 30% of BPM's total assets.

So my main interest in these half-year results is any update relating to Pantheon.

But first, the big picture:

• BPM's NAV improves to £372m (Jan 2026: £360m), despiting paying £13m of dividends.

• Fully diluted NAV per share increases to 996p (Jan 2026: 959.8p).

So there's been plenty of progress to maintain the upward trajectory of NAV and NAV per share over the six-month period, despite the dividends paid.

And the discount to NAV per share, at the current share price, is 32%.

That level of discount says very clearly that the market is nervous about BPM's portfolio valuations, its skill at managing the portfolio, or both! As a shareholder here, I do think the market is perhaps being too timid.

CEO comment from Dan Topping:

“I am pleased to report another strong period for B.P. Marsh. The first half of the financial year saw us convert value built up across the portfolio into cash, delivering meaningful returns to shareholders while continuing to invest for future growth...

Our approach builds on the partnership-led model established by Brian Marsh OBE, which has delivered compound NAV growth of 10.9% a year since flotation, after distributions. With £37.4m of available cash, no debt and a robust pipeline, the Group remains well placed to continue delivering long-term value for shareholders.”

One thing I do appreciate very much about BPM is how they have managed the problem of cash drag. A victim of their own success, they've had "too much" cash on their books, but have gradually reduced it via new investments (both debt and equity) and dividends. It strikes me that £37m is probably still a little too high.

Pantheon: I don't see anything new in today's section on Pantheon:

...Pantheon has established itself as a high-quality, scalable independent specialty broking platform with a growing reputation for the placement of complex risks. Revenue is budgeted to approach £27.7m in the 2026 financial year, compared with approximately £23.8m in 2025, with strong margins and significant cash generation supporting continued reinvestment and growth. Pantheon remains the largest contributor to the Group's NAV, demonstrating the significant value created since the Group's original investment.

The metrics here are quite remarkable:

• Date of initial investment: June 2023

• 31 July 2026 valuation: £112,360,000

• Cost of Equity: £32,800,025

• Equity stake: 41.0%

Pantheon's weight in the portfolio now exceeds 30%:

Group Outlook is strong:

"With £37.4m of Group funds at 31 July 2026, no debt, a growing income base and a robust pipeline, the Group remains well positioned to balance selective new investment with continued returns to shareholders, and to support its entrepreneurial management teams as they grow their businesses."

Graham's view

I am happy to continue holding a small position here, as the 32% discount to NAV does look rather excessive to me.

Even if Pantheon Specialty turned out to be worthless, and was given a valuation of zero, the stock would still be trading at a discount to NAV (the Pantheon investment is valued at £112m, while the gap between NAV and market cap is £128m).

So I think that BPM's share price already punishes it more than enough for not having a very concentrated portfolio.

I could be wrong, of course. But the track record here is genuinely outstanding. So this is a bet I'm personally very comfortable with. I'll leave us on AMBER/GREEN for now, as I wait for a fresh update on Pantheon.