SoftBank Q1: Listed Indian Startups Add Gains Of $400 Mn To Vision Fund 1

The listed startups in Japanese investment firm SoftBank’s India portfolio – Zomato, Paytm, Delhivery and PB Fintech – cumulatively contributed gains of $400 Mn to the kitty of SoftBank Vision Fund 1 (SVF1) during the quarter ended June 30, 2023 (Q1 FY23). 

While Paytm helped SVF1 gain $200 Mn during the quarter, Zomato and Delhivery added $100 Mn each to the fund in this period, the Japanese investment giant’s financial filings showed.

However, SoftBank’s filing showed no gains or losses in Q1 from its investment in PB Fintech.

It is pertinent to note that this is a considerable improvement from the preceding quarter ending March 2023 when these four Indian startups added around $140 Mn to SVF1’s books.

Meanwhile, the investment giant’s gross gains from the insurtech major Policybazaar parent PB Fintech stood at $373 Mn as of June 30, 2023. SVF1’s gains from logistics unicorn Delhivery stood at $259 Mn as of June 30, 2023.

Paytm and Zomato continue to contribute to the fund’s gross loss. As of June 30, 2023, Paytm individually contributed $335 Mn to SVF1’s loss while Zomato’s total contribution to the loss stood at $46 Mn.

On a quarter-on-quarter basis, this shows significant improvement from Paytm’s overall contribution of $526 Mn loss to SVF1 and Zomato’s $131 Mn till March 31, 2023.

This improvement comes on the back of the growing market value of these new-age tech startups that have now started reporting more positive financial results and are marching steadily towards profitability. In fact, Zomato turned net profitable in Q1 FY23.

SoftBank recently offloaded its shares in Paytm, Delhivery, and Zomato in multiple tranches. The Japanese VC behemoth’s holding in Paytm declined to 9.18% in June 2023 from 12.88% in March this year.

In Delhivery, SVF held a 14.51% stake as of June as against 14.56% in March. Its holding in Zomato also declined to 3.35% from 3.36% in March.

SoftBank’s total loss on investment declined to 699 Bn Yen ($4.9 Bn) in Q1 FY23 from 2,834.4 Bn Yen ($19.8 Bn) of loss in the same period of the previous fiscal year.

While SVF1 contributed 38.7 Bn Yen in loss, SVF2 contributed 46.9 Bn Yen, and LatAm Funds 47.5 Bn Yen in gains.

Overall, SoftBank’s net loss fell to 477.6 Bn yen ($3.3 Bn) in the quarter from 3.16 Tn yen during the same period last year.

On the back of mounting losses, SoftBank slowed down its India investments in the past few years. In 2021, it had invested over $3 Bn across 17 deals, which declined to four rounds in 2022. In fact, the fund incurred significant losses across its international porfolio.

SoftBank said that SVF1, SVF2, LatAm Funds are resuming investments again. In Q1, the funds invested $0.9 Bn, up from $0.4 Bn in the prior quarter.