REG - AVI Global Trust PLC - Monthly Factsheet

AVI Global TrustAnnouncement

14/05/2026 14:30

For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20260514:nRSN4014Ea&default-theme=true

RNS Number : 4014E  AVI Global Trust PLC  14 May 2026

 

AVI GLOBAL TRUST PLC

 

Monthly Update

 

AVI Global Trust plc (the "Company") presents its Update, reporting
performance figures for the month ended 30 April 2026.

 

This Monthly Newsletter is available on the Company's website at:
AGT-APRIL-2026.pdf
(https://www.assetvalueinvestors.com/content/uploads/2026/05/AGT-Newsletter-APR-2026.pdf?mc_cid=aa5f284c52&mc_eid=335e1499b3)

 

This investment management report relates to performance figures to 30 April
2026.

 

 Total Returns (%)   Month  1Y    5Y    10Y
 NAV p/s(1)          6.1    13.1  43.4  209.0
 MSCI ACWI(2)        6.9    28.8  69.2  242.5
 MSCI ACWI ex US(2)  6.4    29.9  52.3  157.5

 

All performance shown net of fees in GBP Total Return as at 30/04/2026.

(1)Net Asset Value cum-fair.

(2)From 1st October 2023, the comparator benchmark was changed to the MSCI
ACWI Index. Prior to this, from 1st October 2013, the comparator benchmark was
the MSCI ACWI ex US Index.

Source: Morningstar, S&P Capital IQ

 

Manager's Comment

AVI Global Trust's (AGT) NAV increased by +6.1% in April 2026.

Hyosung Corporation - which we discuss below - was the most significant
contributor (+186bps) as the shares rose +78%. Other strong contributors
included Samsung C&T (+87bps), Cordiant Digital Infrastructure (+69bps)
and Vivendi (+66bps).

Jardine Matheson, Tokyo Gas and Symphony International were the largest
detractors, costing between -42bps and -23bps.

Market environment and portfolio activity

The sharp rally in markets over the last month has - as is often the case with
such things - been met with near universal scepticism. This is not without
good reason with even Mr Trump conceding that the cease fire is "on life
support". The impact of the effective closure of the Strait of Hormuz on oil
inventories, refined products, fertilizers and other commodities compounds by
the day and will rear its head in inflation readings in a few months' time.

Despite the recent rally the portfolio weighted average discount stands at
42%. This is a level previously observed at times of market stress - not the
relatively ebullient market conditions currently in front of us.

Following the sale of Toyota Industries in March 2026 we have material fire
power, with a small net cash position.

Over the last month we have added a handful of new positions which remain
small for the time being and have been busy assessing a broad range of
opportunities.

Hyosung Corporation

Hyosung Corp is the listed holding company controlled by the Cho family, which
traces its roots back to 1966, whilst the current holding company structure
was established in 2018.

The company is in many ways, idiomatic of what we see in Korea: attractive
quality underlying assets with strong earnings growth prospects; a muddied
governance track record; exceptionally wide discounts; and the prospects for
improvement as the winds of governance reform blow.

Starting with the NAV, the key asset is a 32.5% listed stake in Hyosung Heavy
("HSHI") which accounts for 90% of NAV and 310% of Hyosung Corp's market cap.

HSHI is the global leader in high-voltage electrical equipment, most
importantly, large power transformers ("LPTs") and gas insulated switchgear
("GIS"), as well as operating a less attractive residential construction
business.

Electricity is one of those things that most people spend very little time
thinking about but expect - without fault - to "just work". The components
that enable this are relatively complex and this is where HSHI specialises. In
layman's terms LPTs are large power transformers that step-up and step-down
voltage at generation and different parts of the grid, allowing for long
distance transmission or local distribution, maintaining safety and
efficiency, particularly with regard to renewable energy generation which
often enters the grid at fluctuating voltages. GIS on the other hand sit at
the substation level, using pressurised gas to insulate and interrupt
electrical currents, safely switching and isolating parts of the grid to
ensure effective running.

These are mission-critical, custom-engineered pieces of equipment with long
lead times. The high technical complexity requires specialised labour, and the
finished product has stringent reliability requirements / customer
qualification periods. As a result, barriers to entry are high and supply is
tightly constrained in an oligopolistic market.

Against tight supply, we are undergoing a cyclical upswing in demand, most
notably in the US where c.70% of grid transmission Hyosung Corp is the listed
holding company controlled by the Cho family, which traces its roots back to
1966, whilst the current holding company structure was established in 2018.
The company is in many ways, idiomatic of what we see in Korea: attractive
quality underlying assets with strong earnings growth prospects; a muddied
governance track record; exceptionally wide discounts; and the prospects for
improvement as the winds of governance reform blow. Starting with the NAV, the
key asset is a 32.5% listed stake in Hyosung Heavy ("HSHI") which accounts for
90% of NAV and 310% of Hyosung Corp's market cap. lines are over 25 years old
and approaching the end of their operational lifespan and where HSHI benefit
from local manufacturing. Replacement demand is supplemented by transmission
investment, renewable connections and power demand linked to data centres,
with US electricity consumption expected to grow by c.20% through to 2030,
having been roughly flat for the past decade. The electrification of
industries, on shoring, AI, and electric vehicle are all positive secular
tailwinds, and we see similar evolving dynamics in Europe, which is the second
leg of the growth outlook.

EBIT margins have expanded from c.6% in 2022 to c.16% currently and will move
well into the low-to-mid-twenties in the years ahead. Capacity constraints are
pushing prices up as customers jostle for equipment, and the business
continues to benefit from the mix shift toward higher margin US and EU
markets. Results released in April 2026 were supportive of the path ahead. New
orders more than doubled year-on-year and quarter-on-quarter to KRW 4.2tn,
including KRW 3.2tn from North America, while backlog rose to roughly KRW 15tn
- equivalent to c.2.5x annual revenues. All told revenues are expected to grow
12% per annum out to 2028, while more importantly operating income is expected
to compound at 26% per year as high margin US orders from the secured backlog
hit the P&L.

The shares have risen +120% this calendar year, however at c.20x 2028
operating profit, do not seem excessively valued especially given the
visibility of earnings through their backlog and the continued strong growth
we see in the years ahead. Despite this phenomenal performance, the company is
still trading at a c.10% discount to global peers on a multiple's basis, while
EV/Backlog discount is even starker with HSHI trading at c. 1.6x against the
same peer set trading over 4x.

Returning to Hyosung Corporation, a word of caution on governance is required.
We believe there is much that can be done to improve governance at the board
level, with minority shareholders having been largely forgotten. We are also
of the view that capital allocation for the unlisted assets can also be
improved by focussing capital on high margin, high ROIC businesses such as
Hyosung TNC (7% of NAV), one of the world's leading global ATM businesses, as
opposed to some of the other small unlisted assets which do not exhibit these
traits.

In light of the changing governance environment in Korea, such failings are
becoming more costly and difficult to defend - as represented by the 70%
discount at which the shares trade. We expect such companies to come under
increasing pressure and attention. From such wide levels, we believe returns
from any discount changes to be quite asymmetric with even incremental changes
having the potential to significantly move the needle.

To date we have more than doubled our money in Hyosung Corp Returning to
Hyosung Corporation, a word of caution on governance is required. We believe
there is much that can be done to improve governance at the board level, with
minority shareholders having been largely forgotten. We are also of the in
just nine months. Whilst we don't expect the IRR to stay at such a level, the
combination of attractive NAV growth prospects and an exceptionally wide
discount bode well for future returns.

Contributors / Detractors (in GBP)(4)

 

 Largest Contributors             1- month contribution  % Weight(3)

                                  bps
 Hyosung Corp                     186                    4.3
 Samsung C&T                      87                     4.8
 Cordiant Digital Infrastructure  69                     5.2
 Vivendi                          66                     5.3
 D'Ieteren                        63                     7.0

 

 Largest Detractors    1- month contribution  % Weight(3)

                       bps
 Jardine Matheson      -42                    5.3
 Tokyo Gas             -31                    2.6
 Symphony              -23                    2.3
 Partners Group PE     -20                    3.5
 Rohto Pharmaceutical  -17                    2.7

 

(3)All Figures shown as % of Net Asset Value

(4)Contributors and detractors from Factset

 

 

MUFG Corporate Governance Limited

Corporate Secretary

 

14 May 2026

 

LEI: 213800QUODCLWWRVI968

 

The content of the Company's web-pages and the content of any website or pages
which may be accessed through hyperlinks on the Company's web-pages, other
than the content of the Newsletter referred to above, is neither incorporated
into nor forms part of the above announcement.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  DOCMZGMKFDLGVZM



            Copyright 2019 Regulatory News Service, all rights reserved