| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 106.49 | -52 |
| Intrinsic value (DCF) | 74.74 | -66 |
| Graham-Dodd Method | 2.98 | -99 |
| Graham Formula | 2.92 | -99 |
Nippon Active Value Fund plc (NAVF.L) is a London-listed, closed-ended investment company focused on Japanese equities. Founded in 2019 and headquartered in London (domiciled in the Cayman Islands), NAVF employs a concentrated, active value strategy targeting undervalued Japanese companies with strong operational fundamentals. As a specialist Japan-focused fund, it capitalizes on corporate governance reforms and shareholder-friendly policies under 'Abenomics,' offering international investors exposure to a market historically overlooked by global asset managers. The fund operates in the Financial Services sector's Asset Management industry, distinguishing itself through deep local expertise, high-conviction stock selection, and engagement with management teams to unlock value. With ¥51.1 million in revenue and no debt, NAVF provides a unique conduit for value-oriented investors seeking Japanese equity exposure without direct single-stock risks.
Nippon Active Value Fund presents a compelling niche opportunity for investors bullish on Japan's equity market resurgence. The fund's concentrated portfolio (beta: 0.82) offers leveraged exposure to corporate governance improvements while mitigating single-stock volatility. Strong fundamentals are evident in its £359.8 million market cap, £48.5 million net income, and 3.25p dividend yield. However, risks include currency exposure to JPY/GBP fluctuations, reliance on Japan's economic policies, and the closed-end structure potentially trading at NAV discounts. The zero-debt balance sheet and £19.9 million cash position provide stability, but performance remains tightly correlated to Japan's often-insular equity market dynamics. Suitable for long-term investors comfortable with regional concentration.
NAVF competes in the specialized niche of active Japanese equity funds, differentiating itself through three advantages: 1) Ultra-concentrated portfolio (typically 15-25 holdings) enables outsized impact from successful engagements, unlike diversified peers; 2) On-the-ground Japanese team combines local cultural fluency with UK-listed transparency standards; 3) Focus on small/mid-cap value plays avoids overcrowded large-cap strategies of passive ETFs. However, it faces challenges from cheaper passive alternatives like EWJ and DXJ, and struggles to match the brand recognition of established Japan specialists like Baillie Gifford. Its closed-end structure provides permanent capital for long-term activism but limits liquidity versus open-end funds. The fund's edge lies in targeting 'corporate value gaps' through shareholder engagement - a strategy less replicable by algorithmic or index-based competitors. Performance hinges on continued success in identifying underappreciated governance improvement candidates before broader market recognition.