Vef AB (publ)
STO:VEFAB
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Ladies and gentlemen, thank you for standing by, and welcome to the VEF 4Q 2022 Earnings Conference Call. At this time, all participants are in listen-only mode. [Operator Instructions] I would now like to hand the conference over to your speaker today, David Nangle. Please go ahead.
Thank you, Roberto, and welcome, everybody, to our Q4 2022 results conference call. I'm Dave Nangle, the CEO of VEF. And with me today on the call as for the last few calls is our CIO, Alexis Koumoudos. And as for usual, what we'll do is, we'll spend about 20-25 minutes max going through our presentation, update you all on the quarter gone and the year gone by as well as outlook for 2023, and then we'll open up for Q&A and make it a bit more interactive. But slides are on our website and also in the portal, so I'll go through them as I speak. And Key events at Slide #2, key events of the quarter. So what was happening? And effectively, from our side, it's a lot of work has been done on valuation. We continue our robust market-based valuation approach. And that has been key in a world of falling public market comps, when everybody is questioning the value of private companies in portfolios like ours. So we've laid out our shop very clearly. We've been very conservative in the current environment and very robust and I think fairly transparent in what we can do. Over 70% of our portfolio is now buy it on a market-based approach. And what we like to think is that our NAV is very reflective real time on a quarterly basis of the public market reality as opposed to playing catch up or behind the curve. And that's something that we've been stating again and again, and we stand behind our NAV. I think if you look at Q4 and what happened in Q4, our NAV was down to $382 million, down 14% quarter-on-quarter and 50% year-on-year. I think in the quarter, Pure Fintech stocks sold off. And if you have a portfolio indexed against the public market fintech stock, you are going to be hit as a ebb and flow in this current market environment. And year-on-year, Fintech indexes were down between 50% and 60%. So we do a lot of micro level work in our portfolio, but at a macro level, we're broadly down in line with the fintech indexes out there, which is logical given the nature of the portfolio that we hold. And the biggest moves in those -- within our portfolio was our biggest names in credit housing comp mainly driven by pure comps. And on the portfolio front, the fundamental stuff the day today and what's key to today and future value of this company and it continues to deliver. We had a portfolio that grew revenue through 2022, 120% year-on-year. The final numbers are coming through, but it's approximate N number for the full year 2022. And we expect that to fall to about 65% in '23. So yes, more moderated top line growth, as you would expect in a year that's coming, but still very robust levels of growth. And what's combining with that more moderated robust growth levels is profitability or goal to attain profitability. And at this point, about 70% of our portfolio, our NAV portfolio is profitable or can reach breakeven with the current capital position. So it's managing the risk/reward of the portfolio in this environment and which makes sense at this point. On a specific basis, Creditas 50% of our NAV continues to report quarterly numbers. and I'll get into them in the deck and continue to be robust on a growth level. The 9-month numbers for this year, we're up 90% on a portfolio basis and [ 170% ] on a revenue basis year-on-year. And a lot of key positive trajectory in underlying trends that Creditas are feeding through to 2023 numbers and trends, and I'll get into that. And we have a new name, that's the second biggest in the portfolio, just as a new name in the portfolio, but the ebb and the flow of positioning in the portfolio always changes and Juspay is becoming a more and more important asset to invest in our NAV, and we're super impressed by everything that they do on the ground and the business and valuation-wise, we are very happy with where this could go. And from a capital position point of view, we're shy just showed $50 million of capital at the end of Q4 puts us in a comfortable position in the market that we're in. And we're back on the front. But we started to ebb on this in the Q3 conference call, but a lot of the [indiscernible] played last year, but in Q3 and Q4, we started to buy back our own shares, which we paused for now. That was an action on the front for to create value for us and our shareholders opening our IR and PR as you look to reduce that fair discount to NAV, something that read those [ indiscernible] given how much we stand behind our NAV. And more fundamental to long-term growth in our business, we are actually starting to see some fresh opportunities arise at this point in the core investment thesis as well as in the secondary market, something that 2022 on average was lacking as we were looking internally and the opportunity set wasn't as robust as it was in previous years, and I'll get into that. On Slide 3, just some numbers, these came through this morning in our release, but $382 million of NAV on a per share basis in SEK, which the market tends to track 3.82%. And obviously, that cross-references with our share price, which is having around SEK 230 at the moment, SEK 245 at year-end '22. On Slide #4, if you look at our NAV evolution, it is quite interesting, and I said this before in many investor meetings, but the evolution from [ several ] million dollars back in the start of 2015 to $382 million at the end of Q4 '22, those feel like a positive result. And the hindsight when you look at 2021 and the evolution of what happened there, obviously, to a negative indication or direction over the last 12 to 18 months. It's almost like 2021 was the aberration as opposed to 2022. If you look at our long-term performance, we are delivering double-digit NAV per share and double the share price over the last 7 years. So the performance of VEF and what we do is strong and consistent, the evolutions of our NAV and the anomaly that was 2021, to draw back down to today and is very clear for all to see. If I'm looking at Slide #5 and looking at the fintech indexes and which is a basket of fintech stocks, trader stocks and a broad amass of what we do on the private side. For somebody like us who lays out their store at this point in the cycle, valuing our companies against this basket. It's very clear that the ebbs and flows of these indices and the stocks within them, which are benchmarked against our companies will have an impact on how we buy our companies, irrespective of how all those companies are doing. So in Q4, we once again had a sell-off in global fintech. So not an aggressive on like the first half of 2022, but it was definitely a negative direction, 5% to 7%. And within that, some of the comps that we use in different names in our portfolio were down double digits over the quarter. So that obviously fed true to the valuation process. And this is on a year-end 2022 point. So -- and as pure as this process is, the anomalies are, as you sit here today, these indexes are up about 16% year-to-date. And it's not like we're putting -- we're not a public market fund of public holdings. We're not putting it daily or weekly or even monthly NAV marks, but you can see how our NAV mark will ebb and flow with the volatility of these indexes, which are net positive year-to-date, but obviously had a slight down in Q4. If we get into a micro level of the portfolio and the evolution of the valuation in Q4, the names which drove the -- I guess, as a 12% decrease in the portfolio, 14% overall in our NAV. It was the bigger names and even moves and those names they tend to drive more than the smaller names of Creditas off 9% quarter-on-quarter. I see that in the way that Creditas, we took it down in Q2 of last year, in line with comps. I was the logical thing to do. Then it was up 8% in Q3, now down 9% in Q4. Comps are moving in that space and Creditas is a reflection of them. We also did put a $5 million additional check into Creditas and a convertible note along with other internal shareholders in the period. Konfio down a more substantial 34% in the quarter. The comps against this were more dramatic though, the majority of that negative move is comp driven. We also did reduce our forecast for Konfio in a more moderated growth drive the breakeven scenario as opposed to a more aggressive growth and burn scenario, and that's obviously reflected in these numbers. Beyond that 2 of our smaller names, Magnetis and Finja in different markets, different businesses. We're more conservative reducing them at this point. And [indiscernible] want to stand out, and we reduced that by 74% quarter-on-quarter. And effectively, it's the time line of them closing a funding round, which is ongoing. And we took the logical conservative stance to not imply a successful rate and not imply the benefit from that raise and end market the business without that raise embedded as opposed to when the rate gets done and closed, and it will be a different business with different growth profile. So it's a logical conservative move at this point in time. At this stage, from a valuation perspective, maybe I'll pass over to Alexis for the next few slides before I take up at the end, Alexis.
Great. Thanks, Dave. Hi, everyone. Yes, just to double down a little bit on what Dave has been alluding to in terms of a bit more color on valuation and portfolio side. But Slide 7 is just a reminder about our approach to valuations and therefore, how we shape on that. We continue to implement what we believe is a very robust and conservative approach to assigning fair value to our stakes and portfolio companies. First of all, we categorize all companies according to the period of time since the last significant transaction. So portfolio companies that fall within 12 months into last significant transaction, we mark to last transaction. We -- at the same time, we identified comps for these companies and benchmark implied differences in valuation based on what we determine to be key multiples. If there's any meaningful change in the environment within this period, we calibrate the last transaction valuation to reflect the change in the environment. Beyond the 12 months from the last transaction, we used mark-to-model methodology based on identified key public comps and relative valuation methodologies. So you can see that these methodologies are designed so we reflect changes in the market environment as well as changes in the outlook for our companies at all points in time and that our NAV reflects what we and our auditors feel are true and fair values. On the next slide, Slide 8. We just go into this in a little bit more detail. So as you can see, of the 17 portfolio companies, 7 portfolio companies are marked to the latest transaction, which represents 27% of our NAV contribution. And on this slide, we disclose a little bit more in terms of detail of these rounds to illustrate how recent and significant these transactions are. And the remaining 9 portfolio companies are valued on market-based methodologies, which represents 71% of NAV contribution. This includes Creditas, which is valued based on a calibration methodology. On the next slide, on Slide 9. This -- we've designed to give a brief update of the NAV and portfolio performance. So over the course of 2022, NAV reduced by 50% to reflect the current environment and the resulting fair values of our portfolio companies. And as shown in the previous slide, 71% of our portfolio is marked to model-based or market-based valuations and 29% on last transaction. Over the course of 2022, our portfolio companies grew revenues by 120% on a weighted basis, which was in line with our expectations of the previous quarter. And our internal expectations for revenue growth in the portfolio for 2023 is 65%, which I think reflects 3 things: One, the NAV contribution is concentrated amongst our largest portfolio companies. Two, some of the larger companies are reaching a scale where growth tends to taper, and three, across the portfolio companies, the companies are correctly focusing their efforts on -- and their resources on efficiency and profitability. We believe this is a strong growth considering the environment and maturity of our portfolio. One of the key factors enabling our portfolio to continue to sustain such good growth is our relentless focus on strong unit economics in the portfolio. On the portfolio capital needs, we feel generally very well positioned to navigate the current environment, 69% of our portfolio in terms of NAV contribution are or can reach profitability with their existing capital position. The remaining 31% of our portfolio, which is typically earlier stage or companies in growth mode have a portfolio weighted runway of 15 months, which we feel comfortable with. On the next slide, Slide 10, we produced a bridge isolating the attribution to various factors for this -- for the fourth quarter moves in dollar value. We split this into 3 categories. So the first is the 71% of the portfolio that's valued on market-based approaches. The second is 29% of the portfolio valued on last transaction. And then the third bucket is changes based on activities at the corporate level. And as you can see, the portfolio company performance and actually the outlook in terms of NAV attribution was largely in line. Overall, our portfolio has delivered well on the fourth quarter targets, but some adjustments have been made on outlook to prioritize efficient capital allocation and path to profitability. The largest impact on this entire bridge is, in fact, the market impact, which effectively contributed to a $68 million reduction in our NAV for the quarter. This reflects a reduction in comp multiples through equity market performance in the quarter. This is an external force, but given our process-driven valuation approach for deriving fair values in this window, there's a direct impact from market moves in our market-based valuations. There was a small impact from FX as most of our currencies, including the Brazilian Real and Mexican Peso strengthened marginally in the quarter and $9 million within this bucket from new investments and other captures the $5 million that we invested in Creditas' convertible note and some other small movements. For the portfolio based on latest transaction, there's a small impact from FX on shares, which were priced in non-dollar currencies. And in the corporate bucket, you'll see the $7.8 million represents the -- the $5 million that we invested into Creditas and also our OpEx. And there's a small translational effect of $3.8 million from FX, which is related to the strengthening stack and its impact on our sustainability bond, which was a tailwind in the last quarter, but some of that has reversed. So I think the key takeaways here are portfolio is delivering on -- in line and on target, but $68 million of the $63 million reduction in NAV is coming from the market forces which, as we know, can as easily reverse as it comes down. And actually, markets have made a very strong start to 2023.
Super. Thank you, Alexis. Look, a couple of slides from my side before we wrap up and open up to Q&A. One is Creditas. Obviously still approximately 50% of our NAV continues to release their quarterly numbers. These are all public information as released by Creditas themselves. The Q3 numbers are the latest set of numbers and they're reflected in the next 2 slides that I'm showing. And what they do show is real-time company still delivering robust growth 9 months of 2022 versus same period last year. You have a portfolio growth of nearly 100% and top line revenue growth of 173%. It's hard to ask much more than that on the performance of the company. What I have -- besides that from Creditas is a reiteration of the message giving last quarter. As we look into Q4 and as we look into next year, it's still very much a robust growth story. We're not going to double and triple the portfolio from here, be more moderated. We feel very robust by any normal standards. What we like is the trend and the underlying number that Creditas as they have a lot of positive dynamics from an analyst point of view and an [ Xcel ] point of view as they reprice up the asset side of the portfolio. On the funding side, where they've been squeezed on their gross margins, [indiscernible] the interest rates in Brazil seem to have topped out. So I put the cap on where that funding cost has gone and the next situation is flat to down, which is obviously the next benefit on their margins. From a cost and CAC optimization, that continues, and we see that benefiting at a business and the numbers. And all this moving in the right direction towards reducing burn and getting to breakeven at some point in 2023, which then leads to a plan the potential IPO at some point beyond that with 2024 being a logical goal and data point or something like that. But obviously, many moving parts. From a share price NAV per share premium discount, look, we're not happy with how the year 2022 played out from an NAV per share on a share price, but it is a reflection of what happened in the markets. And as Alexis alluded to, it was very much a valuation comp thing. We've had no real car crashes in our portfolio, very much in the top end. The businesses are holding up very well, irrespective of being worth less today than they were worth yesterday. I don't think it's not the kind of environment where one gets rewarded for conservatism in one's valuation mark. The market tends to look true and not prefer the downside and extrapolate a bit like at the back end of 2021 when things are on the up. The market tends to look through and extrapolate the upside and trade a premium to NAV. We get that. But where we see ourselves now with our analyst view is we're becoming a very clear a value play, given the discounts nearly 50% NAV as well as a higher base of growth play. We're probably not the first iteration growth in recovery stock, but we get how we'll be higher beta into that and how we're very much dependent on our core portfolio, which is performing combined with how the markets perform from here. From a closing discount to NAV, this remains front and center of everything we do as a company. We care. We care because we run the company, we care because we're shareholders, and we care because we believe it's wrong, even though markets talk and we understand that. We launched the buyback last year. We carried out through to Q4. We pulled that for a window, but it's there for us to do more. We have the ability to do up to $10 million buybacks in our own shares. On the IR and PR front, we have never shied away from engaging with investors, and we're finding new investors continuously for our stock and our story there different areas of the investment community that are finding our story for the first time with different mandates and liking what they see. And we've had a lot of our core investor base. If you look at our cap table shareholder base at the end of 2021, you move to the end of 2022. The core of that is still very much there. And we're very proud of that, and we're very happy and grateful for that enough because we do a lot on the Investor Relations front. We are listening to the market. We're doing our best on increased transparency. You see our decks on a quarter-by-quarter basis getting better, deeper, more details as we are listening. The nature of our business is investing in private companies in emerging markets. They are private. That's the key word. Not every company can be like Creditas and who is starting to open their [ kimono ] and share information with the markets we like that it helps us, it helps you. And we do our best with other companies as they grow up and they're willing to share. And the investment performance, I'm trying to get cautiously optimistic about 2023, not that it's quite business as usual, but it is a year where I expect to see once again companies within our portfolio, raising capital in, let's call it, a benchmark way of raises above the last round for more capital coming into them. M&A is very much on the table this year, potential exits. These are kind of key events I expect to be happening as we run through 2023 as well as from a valuation point of view, not to call the bottom because as stupid call the bottom. But at those team, we are ebbing and flowing around the bottom, and I do like the start of the year that markets have had, especially in tech and that reflection that it has from a valuation point of view on us, on our portfolio. And from a capital position, this is an update on last quarter's slide the $48.5 million in bank at the end of Q4 '22. The moving parts are similar other than we took $5 million out of the portfolio needs, which we invested in Creditas and the convertible. The buybacks still sits there and coupon in OpEx. And at this point, the expectation is that the cash position at the end of 2023 with $27.5 million at their current plan and evolution of the plan, but there's going to be many moving parts to that as we go through the year. And final slide, just to wrap up before we open up to questions from you guys. I guess to reiterate, 2022 was a year to play defense -- after what happens initially at the start of the year, I believe we played the fence very well. We didn't step on any land mines. They were everywhere. Our job was to make sure we kept this portfolio intact in good shape. We defended it where we could put more capital to work and support at our companies. We've got our own balance sheet right with the sustainable bond. I'm a very focused team. I've got our NAV down. We're -- it's not that we're proud of what we've done with our NAV, but we are market people, and we're very quick to move to the new market reality as opposed to the more private world, which maybe has a lag effect just given the nature of what they do versus our public market base. I think we're starting to lean forward in second half '22 is inching forward. Don't get me wrong from the buybacks and looking at opportunities, talking to our partners, again, I'm actually in the Middle East right now, Alexis will be in the 2 weeks' time, very much back on the road, very much in the trenches with our companies and our partners. Buying back our shares was the first obvious capital move on that front. But investment opportunities that I'll talk in a second are starting to appear. Capital position is comfortable. I'm happy with that. Creditas, our biggest holding continues to do us proud is in a very good place from a performance point of view and unlocking into 2023. But there's other names, and I talked about this in the management letter -- names coming through, but just paying Gringo not to pick 2, are probably top of list of names that excite us most with potential impact for [indiscernible] company or NAV as we look into 2023. That's not taking a 5-year view or a 10-year view, but being very short term as there are 2 companies that really excite us and can do great things for us and our portfolio company. And finally, from the investment opportunities, what I would say beyond buying back our own shares, putting more capital to work in an opportune way in our own companies. We are starting to see opportunities coming through with some of the better fintechs now starting to raise capital again, names that we maybe missed in the last cycle coming back to the market a more realistic valuations. And also, we're seeing a lot of secondary being shaken out in the market where investors and companies in our portfolio and elsewhere, maybe off out of their own jurisdiction. Angels has made a lot of money from early even the things that fall back. Those blocks are starting to come a little more vibrant secondary market is evolving, and that just screams opportunity, somebody like us, you've got true cycle permanent capital. What I'll do, we've gone on for a little bit longer than usual, but I'll stop there and ask the operator to open up for Q&A and myself and Alexis will happily answer.
Ladies and gentlemen, we now begin the question-and-answer session. [Operator Instructions] The first question from Jack in Gunner from DNB.
So can you talk a bit about from a sequential point of view, how your, call it, growth strategies have been revised in a fashion that was most perhaps factored or reflected in Q2, Q3. So have you revised down your, call it, growth ambitions for, call it, a 2023? And is there any way you can provide some sort of like aggregate portfolio ambition? Are we talking yes, obviously, it's Creditas [ country ] and just basing the bulk of this, but are we talking like 50% revenue growth in the portfolio or less so?
Maybe I'll start and Alexis feel free to override at that. But obviously, the portfolio of 17 companies, and there's a lot of individual stories within that some actually models have been opt also have been cut, and they might have been cut at volume and balance sheet level, but they might be staying stable at a revenue level because while volumes may be pulled back for a variety of reasons, margins are going up in many of our markets. So kind of introduction preamble to your question. On top of that, I guess, we've stated that our companies are growing revenue, let's call it, a consistent line of revenue across the portfolio, 120% in 2022. And we currently have a model at about 65% for 2023 on aggregate. And we will be more conservative than the models that our companies provide us we do our numbers around them with a conservative bias. And what I would say, generally, and I can give you a specific number is that, that number for -- as we started 2022, we're modeling 2023, that revenue growth number for ‘23 was higher and logical for 2023 as one would have assumed more capital flowing into these companies and more risk on and more growth -- so you're talking north of that 65%, but we wouldn't have expected 120% year-on-year revenue growth in '22 and then again into '23. You're talking in the range of between 65% and maybe 80% to 90% in range bound. And then it's just different companies on a case-by-case basis. I'm not sure I can give anything more than that at this point, but I don't know, Alexis, if you want to overlay that with anything of interest.
I don't have much to add to that. I think you've covered it pretty comprehensively.
Sure. But then giving this like back of the envelope calculations, I would assume that some sort of -- looking at your portfolio aggregate, call it sales multiple on our 2023 basis would come down below, call it, 5 terms or something like that? Or am I roughly in the ballpark there?
Certainly... Yes, I'd say -- so there's 2 portions of the portfolio. One is based on like market multiples or -- and that is comfortably below 5x yes, I would say. And then the other is like based on last round transaction values. And we have implied multiples that we track there, but I don't have an aggregate number there.
That's fine. Let's not spend too much time on like technicalities. So can you say anything about, I mean, call it, asset quality across your lending business and also what you have seen in terms of -- in the first month of 2023, if transaction volumes are coming down as everybody is concerned over slowdown?
Yes. I think from an asset quality point of view, I guess all eyes on the top of our portfolio, which is Creditas and Konfio, albeit we have other lenders, be it Revo Russia and Abhi, landing in Pakistan, Jumo in Africa. And asset quality, I know it's surprising, but hasn't been an issue hasn't been issued yet. As in everyone is looking at it in Brazil. There's a big focus on asset quality and the analysts on the street who are looking at all the listed companies, banks, lenders, and we're very focused on the asset quality evolution of NPLs and all the data below that first payment to fall through to provisioning. And while we have a few banks on average shown a bit of strain, other ones are showing less strain. But net-net, we are not seeing an issue. As we Creditas asset quality, I think the headline would be stable. Konfio feels very similar. So nothing has -- the trajectory in Q4 has been stable versus Q3, and that is pretty much across our portfolio. So I don't -- at this point in the cycle, we are not looking at an asset quality problem. That may change or things may get -- it might be a modest cycle or from here, but nothing to flag on that front. From a growth point of view, different markets, different trends, but Brazil is a market where January is a big month whereas December is a quiet month. And so 2 companies like Creditas and FinanZero, our digital arm broker is seeing transactions pick up in January as is normally the seasonal case. -- butter markets are a bit slower in January. So it can be mixed market by market. But nothing new in January as you come back in the new year from a volume point of view where we go, "Oh, this has changed or old didn't expect that.
And can you talk a bit about the fact that you've utilized, yes, 1 quarter or 1/3 of the obviously share buyback and back to back that you had? And then the weighted average price, which you have bought back shares have obviously been higher where the shares concentrating. So you obviously see value on the upside where the share price currently is. With regards to that, can you just comment a bit about okay yes, basically, your capital position and the fact that you paused to buyback program here in November and how you see things played out? Are -- I mean, are there any, call it, what's the quality of potential targets out there basically.
Yes. No, lovely question. The former analyst to me would have asked the exact same question. So I do like it when my analysts had on. But I put my CEO hat on here is what I say. I'm very happy we have the buyback mandate. This limited a number of the $10 million. I'm very happy that we executed a part of it in Q3 and into Q4. It was the right thing to do with indications in the market at the right valuation. I would buy back so much more of our stock right now. If I was in a much better capital position to do so. It's the most obvious and logical thing I could do with any excess capital. I look at our capital position today, and I use the word comfortable, but it's not in excess. And I look at the world today, and there's still a lot of moving parts. So it's more of a CEO into CFO, taken to our Board, asset-liability capital management decision, whereby we're happy to have the mandate, we would fundamentally be very happy to buy back our shares at these levels. But we're just holding back for now on doing that. So it's more capital risk management preservation, albeit a small incremental amounts as opposed to anything changing in our view of the merits of buyback and the value they're in.
I hope -- well, let's all hope you can put on the CEO cap again later this year Dave-- thank you. That's all for me.
Thanks. Thank you for your question. We are now taking the next question -- the next question from Priya Rathod from KBW.
I just had a question on your cash position. So looking to 2023, you're seeing and actually looking for investment opportunities. Do you feel as though you've got enough cash to deploy to take those opportunities? And I mean in the context of if an opportunity arose tomorrow, are you comfortable with your current cash flow and liquid assets to invest? Or would you potentially need to exit one of your holdings to invest? Any color on that would be great.
It's a very fair question, and thanks for outlook. What we've run over the years is a, let's call it, a just-in-time cash business and cash in business. So a little bit of risk in that. But our last 2 placements were done at a point when we were low on capital, and we had deals lined up, and we went out to our shareholder base, explained the situation and raise capital for all the right reasons to put that money to work in names like Creditas, Konfio, [indiscernible] in the past. And we kind of see it similar at this point in that our cash position is comfortable. We're very -- we can nibble our shares from a buyback if we want to continue that. We have capital plus by $5 million in the credit cost. We've got under $6 million set aside and Konfio out with one other. And that makes us happy from a portfolio spans point of view. It doesn't make us running out there making writing big checks. But when I start to say the investment opportunities are starting to appear, they're not yet obvious to us as in the right companies, the right valuation, right check side. And but I think that will happen. And then we will lean into our shareholder base as the time is right as the opportunities arise and when that comes. So I think we're very much focused on -- what I like about to not answer cut I like about VEF right now is that we can do nothing else and there's a lot of value creation within what we currently have. So we're not a classic venture capital fund where we have to keep on investing to create value or keep on investment to get paid. We actually have a portfolio that in compounds naturally with some reinvestment as we go. And that's a big value uplift to us, combined with us closing that discount enough. And I think there is some tailwinds on micro level positives in the portfolio coming this year, which will help us do that, and we'll do our best to do that as well. That will then lead into a time line of when we see opportunities leaning into our shareholders in better markets or seeing exits coming through in some of our portfolio companies to help the capital to make the next leg of investment. So we kind of see it as an evolution as opposed to an immediate moment as we need to do something if we find something.
We are now taking the next question -- the next question from [indiscernible].
The first one would be a little bit of a follow-up on Joakim's question on the growth pace. Would there be any way to give some color on how much closer to profitability the portfolio has gotten compared to what the plan was at the start of 2022 given the increased focus?
Yes, there's a different way of looking at it. And I guess the links, the idea of growth and profitability and moderating growth to get to profitability quicker as opposed to excess capital, excess expansion, customer acquisition costs to grow volumes and top line quicker, but pushing out that breakeven point. So I guess that the reflection is that the 120% 2022 revenue growth forecast or fact going to a 65% forecast next year for the portfolio. And that is reflecting more of the portfolio being at or looking to get to breakeven in this year. And we say breakeven at this point, we're taking Revo in Russia or Nibo in Brazil, and two are Pakistani companies, Mahaana and Abhi, give or take, breakeven that just pays not far off. And just like we're the #2 holding in Creditas within that plan to break even this year and the numbers and trends should get us there. And likewise, Konfio's on a plane out. So if you asked us the same question 12 months ago, would it be 70% of the portfolio would be breakeven or plan to breakeven this year, it would be less a bit like Joachim's question, it would be in the 30% to 50% mark of our NAV as opposed to 70% plus from top of minds guesstimate, but I have to fray looking at it.
Then there's been some questions on yourbonds and if there's any covenants that are at risk now when you're approaching to be in net debt position. Could you just clarify that for the markets?
Yes. No, it's a fair question. And Rick and I look at it a lot. Obviously, it's a key aspect of our capital structure. My answer would be no. There's nothing top of mind that's restrictive. There might be 1 or 2 small things and allow me to come back to you and they don't, but nothing essential or dramatic, I believe. So let me double check with Henrik on this and come back to you directly on anybody else in this call that wants to know. But from going from net cash positive to net cash negative, I don't believe we are restricted in any major way. I would know if you were, but not in a major way.
That's perfectly fine. And then maybe more specific questions on a few holdings, and we can take them directly both of them. Maybe first with Revo. Is that just a policy decision to have it at zero? Or do you think that there would be no way to extract cash if you wanted to from it today. So I think what I'm fishing for is basically what could imply the valuation if you would do a more fair value assessment of it today if the zero is just a policy decision? And then the second thing would be, you mentioned that the embedded discount of Juspay versus peers has been expanding. Could you just give us any sense of how big it is today? And where was that the point of the last transaction you did there?
Maybe I'll do Revo, and I'll let Alexis jump in on -- Juspay. And Revo, Russia has a policy decision. There's no offense to Revo on a micro level. It's just Russia is where it is in its cycle of life. And it is, I guess, the parallel University is Russia, what is anything worth in that market? And how can you realize it and then how can you expect the capital from that market, which is quite difficult right now. So Revo is a profitable company. As I said in my management letter, we're talking double digits will be low double-digit million dollars of bottom line, not top line. What does somebody pay for, let's call it, a $10 million bottom line consumer buy-now-pay-later company growing at a healthy clip in Russia. Did they pay 5x, PE --did it pay 10 -- 10, maybe 5x10 it's $50 million. That's the company level value. We own 20%.[indiscernible] like that. And that's does just mean drawing out general numbers, [indiscernible] putting a value on it. But -- then there's the other side of that of its earnings being in Russia and can those earnings be dividended out to the variety of shareholders who are in place. Like all this -- none of this is lost, but us. We're very involved in Revo, albeit we've market to 0 for the right reasons. And we're working all avenues on that one while making sure it continues to be a healthy going concern and continues to grow in value, albeit being in that market. Now it's going to grow in business outside of Russia, in East Europe and Poland, Romania now Bulgaria and there's value in that, but a small versus the Russian business today. So that's on Revo. Alexis, if you want to make anything to say?
Absolutely. Yes. Yes, what I would say on Juspay is the -- the last significant round that they did. So they took in additional money in June, but that was effectively an extension of a round that happened at the beginning of 2022. I think it closed like around January 2022 or the end of 2021. At that point in time, the valuation that we have just pay marked at today is the valuation of that round. And at that point in time, it was a very realistic kind of multiple when you look at like peers and public comps. The company has since delivered broadly 100% year-on-year revenue growth. They still have a lot of cash in the bank. I think we are facing a time probably in 2023 when -- unless they raise money again, we will be looking to move this to mark to model. And as Dave implied, I think there's some pent-up NAV attribution that could come from a process like that. And I think the delivery of Juspay has been extremely good, and they occupy quite a unique position in India, which has become a strategically important market for payments companies and fintech and tech companies generally. So yes, I think there's a few tailwinds that could result in some kind of a meaningful change in the valuation of Juspay. We can't promise anything, but those are the factors at play here.
Yes. Thanks, Alexis. And we look to [indiscernible] stuff. But I think we're hoping to show and I hope you use the word conservative over and over and a lot of companies and investors talk about it, but you talked about Revo there. Alex has talked about Juspay. We're back and forth on Konfio, which we're valuing at less than our cash invested value, which obviously is below our press stack value, which we can get back, we wanted to throw that term into a valuation. We've been very aggressive with Creditas in line with market, albeit a top of last round during the summer. So I know the market doesn't award us from a share price and a discount to -- no point of view, and I get that. But I guess we're hoping to -- we're looking to stand behind our NAV and throw all this conservatives out to the market and then benefit on the way back up.
I think that sounds very reasonable.
And sorry, Irwin, just one more thing. Henrik as at me in terms of our covenants and on the bonds and nothing major to highlight with plenty of headroom in the covenants that they found.
We are now taking the next question. The next question from Joachim Gunell from DNB.
So just a final one with regards to the, call it, 30% of your NAV, where you believe that perhaps that part of the portfolio is not necessarily entirely funded to breakeven gap. What are your thoughts here with regards to whether you are fully willing to take your pro of the share in coming funding rounds? Or can you say anything about if there are any cases where you perhaps could be taking even -- or if you are afraid that you'll have to take it even beyond your [indiscernible] share with regards to what we have seen with some, call it, investors who were attracted to put the emerging markets finding opportunity, but it's not necessarily as attractive to it anymore.
Me, I thought those rules about people having 2 questions, but we'll go with it. But what I'd say, Joachim, is that we're not forced to do anything. It's not -- we look at every investment decision, whether it's the first investment or the fifth investment in any company on a case-by-case and individual basis. We've also got to a point in the cycle where capital is a bit more scarce and investments decisions and processes are sharper or sharp as ever in our case. And we put our capital to work where it has the best impact from a NAV portfolio return on capital point of view. We don't like our companies failing. But in the world that we play in, it can happen if companies don't make it. And we look at each raise on a case-by-case basis. And we're as likely to put more money in as we're likely to put no money in. We're not on the hook for anything and we're in a good position to call these. And what we've looked to address from a NAV and NAV importance point of view as the top end of the portfolio first and foremost because it's the most logical and important for us and that's Creditas and Juspay and in Konfio. But even below that, the Rupeek, the Blackbuck, Solfacil, Gringo names which can -- some of those can get to breakeven to the current capital, but look, very, very good position to raise capital, and that will be maybe with or without our capital. So we're not feeling like we're about to look over to cliff on any name where it needs capital. We don't want to get them capital, nobody gives them capital and they're in trouble. That's not the case where we're at this point, albeit we might have some microlevel situation both as we go forward.
Perfect. And just the very final one with regards to that's okay, even if there are no obvious opportunities out there as we go into, say, mid-2023 and you hopefully can find some. Can you say anything whether you think that the strategy on new on ships where you took like 1%, 2% clicks in some interesting assets, whether that hasn't worked out where you would hope it will be as opposed to being a more active owner on the Board et cetera.
Yes. I think our natural bias is to take side stakes and be active ideally in a positive way and be good stewards of our capital and be in the trenches of our companies and be very involved. There's nothing wrong with taking minor investments, especially if they're going to return on capital investments. But the bias would be for -- if we're to take a minority stake, a small one like we did will Rupeek, but we built it up. And now we've got -- not a Board seat but a shadow board seat in that company to build their position and Blackbuck with a smaller position again. But I think our natural tendency is to go for those Gringo like stakes where we get size, double-digit percentage and Board representation. It's more what we do try and test it.
There are no further questions at the moment.
Super. Look, thank you, operator, and thank you, everybody, for dialing in and staying with us. This has been a long results call, probably our longest to date, indicative of an environment that we are in, but also I think growing investor and analyst interest in our stock. So we respect that, we appreciate it. I hope the message is coming across clear from our side around conservativeness, bouncing around the bottom, opportunities in to lean forward. And I think I can say at this point, we are cautiously optimistic about 2023 while still conservative in paying some defense as we go because we're not out of the woods yet. So thank you very much and look forward to seeing you at the Q1 conference call.
That concludes the conference for today. Thank you for participating. You may all disconnect.