SoftBank swings to $7.7B profit in September quarter

SoftBank Group Corp turned to a profit of 1.2 trillion yen ($7.98 billion) in the second quarter of FY25, helped by the successful listing of its portfolio companies during the period.

The Japanese investment conglomerate made investment gains of 608 billion yen ($3.96 million), which helped it report a fourth consecutive profitable quarter. In the year-ago period, SoftBank recorded a loss of $5.13 million.

Vision Funds (SVF1 and SVF2) sold investments totalling $1.85 billion for the six-month period ended September 30, including full exits from 10 portfolio companies such as SenseTime and Paytm, and partial exits from several other portfolio companies.

Two high-profile SoftBank-backed companies in India—FirstCry and Ola Electric—made strong public market debuts with a solid demand for their IPOs. However, the stocks have since fallen below their listing prices.

Ecommerce enablement SaaS platform Unicommerce saw a record-breaking demand on the final day of its IPO, listing at Rs 230, a 113% premium over its issue price. However, the stock has since dropped 14.34%.

Omnichannel retailer FirstCry's parent company, Brainbees Solutions, also enjoyed a premium listing at Rs 625, 34% above its issue price, though it now trades below that level.

Meanwhile, Ola Electric made a flat debut at Rs 76 and initially gained momentum before slipping due to operational challenges. The listing of Ola Electric in August 2024 positively impacted SVF2, boosting its public portfolio valuation by 0.2% for the quarter.

SoftBank reported a fair value of $1 billion as opposed to an investment cost of $600 million in Ola Electric, and $800 million in fair value for Brainbees Solutions compared to an investment cost of $200 million.

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Swiggy IPO gets oversubscribed led by QIB bids

Swiggy, another SoftBank portfolio company, is planning to raise close to Rs 11,700 crore in its IPO at a valuation of Rs 87,000 ($11.3 billion) at the upper price band, set between Rs 371 and Rs 390 apiece, when it lists on the Indian stock exchanges tomorrow, November 13.

At 3.59X subscription, Swiggy’s stock has seen lower demand compared to the recent startup IPOs, including its rival Zomato, which was subscribed nearly 38 times.

AI bets

SoftBank, under its founder Masayoshi Son, has been shifting focus to rising opportunities in the artificial intelligence (AI) space. The company is in talks to invest $500 million in OpenAI through the Vision Fund, according to reports.

This is not Son’s first AI bet as he had, earlier this year, led a $1 billion investment in Wayve, a British self-driving car manufacturer. Softbank is also in talks to invest between $10 to $20 million in Perplexity AI, giving Google Search a run for its money.

(1 Japanese Yen = 0.0065 USD)

(This article has been updated with further details)