Investment trust insider on Seraphim Space – James Carthew: Watch this space on Seraphim
As space economy input costs fall and more of Seraphim Space’s portfolio earns revenues and profits, its 43% discount has plenty of scope to narrow.
Part of the fun, and the challenge, of my job is that I get to look at a wide variety of funds, some of which have some pretty unusual business models. One of those is Seraphim Space (SSIT).
I am well aware that this trust is probably a bit marmite for investors, as most growth capital trusts seem to be. It has to convince investors both that they want an allocation to the space sector and that this trust is the way to play it.
On the latter point, there are not really many other options. There is an ETF run by ARK, but it and other competing vehicles only focus on the listed sector, and in an embryonic area such as this, the best opportunities are often still unlisted.
I last wrote about SSIT back in May 2022. The net asset value (NAV) has been fairly flat since then, which is not bad considering that sentiment is still against growth stocks and particularly unprofitable growth stocks, as it has been since interest rates started to rise a couple of years ago. SSIT would have done better were it not for the disappointment of Arqit Quantum (discussed at length in that May 2022 piece), which has reined in its ambitions and seen its share price collapse. However, today, much more of SSIT’s portfolio is earning revenues and profits, and it continues to attract finance from third-party investors.
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