REG - Nippon Active Value - NAVF celebrates 5th anniversary

Nippon Active Value FundAnnouncement

26/02/2025 12:15

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RNS Number : 5677Y  Nippon Active Value Fund PLC  26 February 2025

 

NAVF celebrates 5(th) anniversary with cumulative investment gain of 103%

 

LONDON - 26th February 2025 - Nippon Active Value Fund plc, a LSE-listed
investment trust that engages in activist campaigns targeting small and
mid-cap stocks in Japan, has celebrated its 5(th) anniversary with a
cumulative NAV gain of 103% since launch in 2020.

The investment trust's performance saw it win a Citywire award in 2024 for
Best Japanese trust over three years to August 31. NAVF recorded a net asset
total return of 51.1% over that timeframe.

Rosemary Morgan, Chairman of NAVF, said: "NAVF has outperformed Japan focused
trusts and the wider investment trust sector since launch. The success of our
approach is underscored by the consistent investment performance, small
discount to net-asset-value and our absorbing of Abrdn Japan Investment Trust
& Atlantis Japan Growth by large shareholder majority votes."

Paul ffolkes Davis, Chairman of Rising Sun Management, NAVF's investment
advisor, said: "NAVF offers British investors a three-fold play:
diversification, compelling valuations and an opportunity to ride the activist
wave being encouraged by the Japan government's increasingly effective
governance and reform policies."

Diversification
Typically, British investors look mainly to the US to complement their primary
UK equity allocations. NAVF shows that diversification into Japan is both
performance enhancing and gives UK investors access to companies that are less
correlated to the UK and US markets.

Compelling valuations
Small and mid-cap Japan companies trade on low P/E ratios (often below 10x vs
S&P 500's 25x ) with about 1/3 of all Japan listed (TOPIX) companies
trading below book value, with many having no debt and substantial balance
sheet cash. This provides both a margin of operational safety but also the
means to fund dividend increases and share buybacks.

Wave of activism
Activist strategies are particularly well placed to target and unlock value
from the Japanese market given its unique characteristics. Private equity and
activists have $10s of billions to invest in Japan where they have been
underweight. The number of activist funds in Japan has tripled in a decade to
over 40 - now even investors not generally associated with activism, such as
Silchester International Investors, Neuberger Berman and GMO, are embracing
its tactics.

Mr ffolkes Davis added: "What has underpinned NAVF's approach is its success
in picking company targets in Japan and working with them to take shareholder
friendly measures such as board changes, higher dividend payments, asset sales
and to boost company valuations and investor returns."

"In recent years, the 'Abenomics' corporate governance and economic reforms
(initiated in former Prime Minister Shinzo Abe in 2014) have borne fruit," Mr
ffolkes Davis continued. "Japan's GDP is growing again, companies are
restructuring to provide better ROIC, corporate managers are increasingly
forced to focus on delivering better financial performance for shareholders
and a number of takeovers/MBOs at premium exit prices have taken place."

Ends

NOTES TO EDITORS

About NAVF

Nippon Active Value Fund ("NAVF") is an Investment Trust on the official list
and  premium segment of the London Stock Exchange. The investment advisor of
the Fund is Rising Sun Management Limited. NAVF is targeting attractive levels
of capital growth for shareholders from the active management of a focused
portfolio of quoted small and mid-cap Japanese equity investments. The
investment advisor, Rising Sun Management, targets companies which are
attractive, undervalued and have a substantial proportion of their market
capitalisation held in cash and/or listed securities and/or realisable assets.

Media Enquiries:

navf@@peregrinecommunications.com
(mailto:bill.mcintosh@peregrinecommunications.com)

+44 203 178 6868

LEI: 213800JOFEGZJYS21P75

 

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