Vef Ab · OMXSTO:VEFAB
Vef Ab — Investor Presentation (July 2024)
33 slides from Vef Ab's investor presentation, July 2024
Slide 1: Investor Presentation
Investor Presentation July 2024 The emerging market fintech investor
Slide 2: Agenda
Agenda A Introduction to VEF B 2Q 2024 Results Overview C Key Portfolio Companies D Sustainability 2
Slide 3: VEF at a Glance − the emerging market fintech investor
VEF at a Glance − the emerging market fintech investor Riding one of the strongest multi-year secular growth trends in some of the world’s fastest-growing markets Listed investment company • Listed in Sweden since Dec-2015 ̶ VEF AB (publ) • We were spun out from VNV Global, with a 3% stake in Tinkof
Slide 4: Clear investment approach coupled with deep fintech expertise
Clear investment approach coupled with deep fintech expertise Targeted investment approach with a clear mandate… …and deep expertise across the fintech spectrum • Consumer SECTOR • SME CREDIT • Secured We target all lines of financial services inclusive of payments, credit and • Unsecured savings/in
Slide 5: A diversified portfolio across scale emerging markets
A diversified portfolio across scale emerging markets VEF has backed entrepreneurs across the emerging world since inception in 2015 Portfolio companies Portfolio composition As at 30 June 2024 Geographic Breakdown1 Emerging Pakistan Emerging Europe 1% Europe 8% Mexico Pakistan 17% $459M2 Brazil Ind
Slide 6: Strong track record of investing in benchmark private fintech names across EM
Strong track record of investing in benchmark private fintech names across EM We are now present in one of the top 3 private fintech assets each in Brazil, Mexico & India. We have a track record of backing and successfully exiting fintech champions in Russia and Turkey Current investments in two of
Slide 7: Clear mandate with a proven strategy – strong track record of delivering returns
Clear mandate with a proven strategy – strong track record of delivering returns Proven track-record in value-creation and Ability to identify and access benchmark Driving our strong history of long-term successful exits private fintech names across EM shareholder return +65% IRR Brazil NAV/share &
Slide 8: Backed by blue-chip institutional capital
Backed by blue-chip institutional capital Long-term supportive institutional shareholder base Strong conviction in VEF’s investment appraisal Leading institutional managers maintain long-term holdings and have consistently supported Key shareholders have committed to co-investments in follow-on roun
Slide 9: Established reputation and deep relationships within local ecosystems provides a competitive moat
Established reputation and deep relationships within local ecosystems provides a competitive moat and access to unique opportunities 1 Brazil • Deep sector expertise and a global lens to emerging market fintech Unique global • Differentiated insights from our global portfolio, continuous pipeline di
Slide 10: Management team
Seasoned management with extensive EM fintech expertise, supported by a high calibre, experienced team >6% collective holding in VEF1 Investment team Operations team Management team David Nangle Alexis Koumoudos Helena Caan Mattsson 2015 2016 2017 CEO CIO GC/Head of Sustainability • Experience: 20+
Slide 11: Agenda
Agenda A Introduction to VEF B 2Q 2024 Results Overview C Key Portfolio Companies D Sustainability 11
Slide 12: NAV of USD 437 mln in 2Q24
12 0,0 200,0 400,0 600,0 800,0 USD mln Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 NAV of USD 437 mln in 2Q24 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 NAV Evolution Jun-20 1Q20 Covid impact Sep-20 Capital raises: Dec-20 3Q21: USD 97 mln 4Q20: USD 58 mln Mar-2
Slide 13: Evolution of our valuation marks in 2Q24
Evolution of our valuation marks in 2Q24 QoQ % 2Q24 % of Fair value USD (mln) 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 YoY % change change holdings Creditas 195.9 211.3 193.1 198.7 212.9 183.5 188.8 215.5 215.9 0.2% 1.5% 47.1% Konfiío 61.1 61.1 40.1 48.9 85.6 79.8 95.3 75.5 75.5 -0.1% -11.8% 16.
Slide 14: Valuation approach and key take-aways (1/2)
Valuation approach and key take-aways (1/2) T0 T + 12 months Latest significant equity transaction T0 – T+12 months T+12 months onwards… Mark-to-Model (MTM) • Significant equity transaction within the last 12 months serves as the primary anchor for our fair value analysis. • Post 12 months fair valu
Slide 15: Valuation approach and key take-aways (2/2)
Valuation approach and key take-aways (2/2) Company 2Q fair value Change QoQ Valuation Multiple Comments / Last transaction details Portfolio valuation shifting back to marks validated by (USD mln) (USD mln) methodology recent and sizeable latest transactions 215.9 +0.5 MTM Rev + GP - Latest transac
Slide 16: High quality portfolio, delivering robust profitable growth
High quality portfolio, delivering robust profitable growth Confident with the quality of the companies that dominate our portfolio and their delivery/outlook as we move through 2024 Quality Many moving parts which define our success over time, but quality performing compounding assets form the basi
Slide 17: 2Q24 NAV Evolution
2Q24 NAV Evolution Continued positive contribution from underlying portfolio performance, offset by a contraction in public market multiples and Fx headwinds through the quarter 2Q24 NAV Bridge Key takeaways USD mln • Total USD NAV ended the quarter at USD 436.6 mln, Holdings valued on MTM & calibra
Slide 18: Share price, NAV/share and the premium/discount
Share price, NAV/share and the premium/discount NAV/share & share price development Premium/(Discount) to NAV 7 60% 6 40% 5 20% 4 0% 3 -20% 2 -40% 1 -60% -80% 0 dec-15 sep-16 dec-16 sep-17 dec-17 sep-18 dec-18 sep-19 dec-19 sep-20 dec-20 sep-21 dec-21 sep-22 dec-22 sep-23 dec-23 mar-16 jun-16 mar-17
Slide 19: Closing the discount to NAV
Closing the discount to NAV NAV growth and portfolio exits/partial exits will be the key catalysts in closing the discount to NAV Persistent discounts, differentiation emerging VEF’s strategy to narrow the discount & get back to investing Discounts persist across the broader investment 1 NAV growth
Slide 20: Capital position – comfort with controllables
Capital position – comfort with controllables Solid cash position to cover coupon payments and opex Expected cashflows to YE24 USD mln • SEK 400 mln outstanding VEF • Frame of SEK 1,000 mln 15.8 sustainability bond • Interest: Stibor 3m + 650 bps paid quarterly - 2.0 • Maturity: Dec 2026 - 3.1 0.2 1
Slide 21: VEF investment case and outlook
VEF investment case and outlook It’s all about the portfolio: Quality - If there is one message we continue to share with investors, it is that we are confident with the quality of the companies that dominate our portfolio and their delivery/outlook as we move through 2024. A business like ours has
Slide 22: Agenda
Agenda A Introduction to VEF B 2Q 2024 Results Overview C Key Portfolio Companies D Sustainability 22
Slide 23: VEF portfolio overview
VEF portfolio overview Company Description Stake1 % of Portfolio1 Company Description Stake1 % of Portfolio1 Brazil’s leading digital-first secured Gringo is building a “super-app” 8.8% 47.1% 9.9% 3.7% lending platform for drivers in Brazil Solfácil is building a digital Provides credit, payments an
Slide 24: VEF key portfolio companies
VEF key portfolio companies Provides digital banking products including Brazil’s leading digital-first secured lending Leading mobile payments platform for online Overview platform credit, payments and software tools for merchants in India Mexican SMEs - Payments orchestration platform - Auto equity
Slide 25: Creditas – Brazil’s leading digital-first secured lending platform
Creditas – Brazil’s leading digital-first secured lending platform Market opportunity Creditas value proposition Key stats1 Extraordinary interest rates… Addressing credit affordability through Average APR on lending products in Brazil (2023) collateralized lending $879 mln 40+ 417% Raised across 6
Slide 26: Creditas – profitable and re-accelerating growth
Creditas – profitable and re-accelerating growth 2Q24 update Summary overview Portfolio Under Management Revenues Strong delivery - first full quarter of profitability BRL bln BRL mln • Portfolio and top-line remain stable: 2Q24 portfolio and revenues up marginally QoQ as profitability remained core
Slide 27: Konfío – Mexico’s leading digital financial services provider for SMEs
Konfío – Mexico’s leading digital financial services provider for SMEs Working Capital Uncollateralized loans for working capital and Installment Loans productive investments #1 75k+ ~$400 mln Most issued business card Mexican SMEs benefitted in Mexico (2021-22) Loan portfolio (June-2024) Corporate
Slide 28: Juspay – one of India’s fastest growing payments tech companies
Juspay – one of India’s fastest growing payments tech companies Access to the entire Indian payment ecosystem with one single integration Key Juspay stats Dominant player in the Indian payments ecosystem… Merchant payments platform ▪ Powering entire payment stacks for enterprises $125 bln+ ~5x 130%+
Slide 29: TransferGo – leading European remittance platform
TransferGo – leading European remittance platform Building a global migrant financial services platform Robust growth with best-in-class margins Leading remittance platform with best-in-class UX 1 50% 80% Profitable Revenue growth Industry leading Achieved in Extensive payment choice (2023 YoY) Gros
Slide 30: Gringo – revolutionizing the Brazilian driver experience
Gringo – revolutionizing the Brazilian driver experience #1 App for drivers in Brazil with over 15 mln unique registered users Super-app for Brazilian drivers Exceptional delivery, addressing a large market Gringo has rapidly become the leading platform for drivers in LatAm Core product Unique regis
Slide 31: Agenda
Agenda A Introduction to VEF B 2Q 2024 Results Overview C Key Portfolio Companies D Sustainability 31
Slide 32: VEF sustainable investing
VEF sustainable investing Sustainability as a fundamental part of VEF’s business model Our capital plays an important role in furthering financial inclusion Successfully refinanced sustainability bond in November 2023 VEF supports the UN Sustainable Development Goals VEF proprietary sustainability f
Slide 33: Thank you
Disclaimer The information in this Presentation (the “Presentation”) is furnished by VEF AB (publ), reg. no. 559288-0362 (the “Company” or “VEF”). This Presentation does neither constitute an offer to sell nor a solicitation of an offer to buy any securities, and it does not constitute any form of c