ALTERNATIVE AN OPPORTUNITY FUND INVESTING IN EMERGING MARKETS 30 JUNE 2017

Transcription

1 A S S E T M A N A G E M E N T ALTERNATIVE AN OPPORTUNITY FUND INVESTING IN EMERGING MARKETS 30 JUNE 2017

2 Contents SECTION Description and structure of ALTERNATIVE SECTION Fund Strategy and Investment process SECTION Portfolio Analysis SECTION Financial equilibrium analysis SECTION Issues of ALTERNATIVE Corporate Presentation, June 2017 Slide 2

3 SECTION 1 Description and structure of ALTERNATIVE Slide 3

4 What is ALTERNATIVE? ALTERNATIVE CREATES VALUES ALTERNATIVE invests funds (obtained from shareholders and bondholders) at a rate of ~27% per annum. This way, investing in the real economy the ALTERNATIVE does not create any artificial profits. It also supports a low level of financial leverage. ALTERNATIVE PROTECTS VALUES Selection of trustworthy companies with in-depth European due diligence. We choose mainly short-term and medium-term investments. Bondholders interests are protected by the owners capital in ALTERNATIVE. ALTERNATIVE ALLOCATES VALUES Fund s value is allocated among shareholders. ALTERNATIVE provides bondholders with a coupon yielding on average ~8% per annum which is approximately equal to the increase in the ALTERNATIVE s unit value per year. Slide 4

5 ALTERNATIVE activity ALTERNATIVE does not depend on Financial Markets Movement ALTERNATIVE does not depend on The impact of the changes in the Macroeconomic Indicators ALTERNATIVE does not conduct Investment policy with a high risk ALTERNATIVE was established as a business idea And is not an entrepreneurial organization There is no correlation with the performance of theother class assets, circulated in the financial market. The product is not susceptible to price fluctuations, caused by the volatility in the financial markets. The business model is not affected by changes or valuation errors of the macroeconomic indicators (inflation, GDP, unemployment etc.). Low foreign exchange risks. Investments of funds raised from the bond sales are carried out at market rates. The growth of the ALTERNATIVE s net asset value is due to the strict investment selection and carries very low risk for the investors. ALTERNATIVE is a Luxembourg securitisation fund, controlled by authorities and subjected to Luxembourg law. Net Asset Value (NAV) is calculated by Deloitte Luxembourg on a quarterly basis with an annual independent audit of the JPA International. Slide 5

6 How ALTERNATIVE invests ALTERNATIVE is a securitisation fund without legal personality, created on a contractual basis with co-ownership of assets. ALTERNATIVE is subject to Luxembourg law and complies with regulatory restrictions. The Management company is Mikro Kapital Sàrl, which is registered in Luxembourg. The financing of ALTERNATIVE is done through the issuing of both bonds and units. ALTERNATIVE invests in South and Central America, Africa and East and Central Asia. ALTERNATIVE invests in guaranteed debt instruments within 24 months. The Fund currency is euro. ALTERNATIVE combines both the security and control of the European structure, as well as the return on investment of Emerging Markets Slide 6

7 Distinctive features of ALTERNATIVE Traditional Investment Funds, established for mature markets may use profits, provided by Emerging Markets, but they fail to limit risks. ALTERNATIVE has a more developed structure: it aims to mitigate investment risks without affecting profits significantly. The special choice of ALTERNATIVE to issue bonds enables investors to combine simplicity, reasonable taxation and stable income (determined in advance), as well as investment protection, which would be less possible using traditional Investment Funds. The investment & innovation ALTERNATIVE model corresponds to the characteristics of the prospective markets Slide 7

8 Advantages in comparison to traditional funds Real investments through financial instruments. There is no correlation in return levels with the other class assets circulated in the financial market. The team, operating in the territory of Eastern Europe, are directly acquainted with the entrepreneurial network and companies which are the subject of financing. An industry diversification of the ALTERNATIVE s investment portfolio allows the mitigation of investment risk. Risk coverage is ensured by pledged property (movable and immovable property) and personal guarantees provided as collateral by the ALTERNATIVE s borrowers. The ALTERNATIVE s equity is an additional guarantee to the bondholders investments to the Fund. Duration and returns of investments are defined at Subscription Date. The duration of the investments equal 24 months with the first coupon payment 3 months after subscription date. Thanks to the activity of local teams, the ALTERNATIVE experiences rapid growth and develops a wide network of contacts. Slide 8

9 Financial information NAME LOCATION CURRENCY ALTERNATIVE LUXEMBOURG EURO TARGET VALUE TARGET: C. 40 MILLION EUR BY 2018 (22,4 M IN JUNE 2017) LATEST APPROVED NAV June 2017: ,30 (49,14% from the start) MINIMUM INVESTMENTS EUR 125,000 FUND ADMINISTRATOR CUSTODY AUDITOR LEGAL ADVISER NAV EVALUATOR ISSUE FREQUENCY COUPON MIKRO KAPITAL SÀRL UBI LUX (LUXEMBOURG); BENDURA LIECHTENSTEIN ACSE, LUXEMBOURG CARNELUTTI STUDIO LEGALE ASSOCIATO DELOITTE LUXEMBOURG MONTHLY QUARTERLY YIELD (YEARLY) 8% (EMTN 24 M) BLOOMBER CODE MKKK Slide 9

10 Growth of performance (NAV) From launch +49,1% NAV ALTERNATIVE Net Asset Value ALTERNATIVE bond index +20,1% Bond index Slide 10

11 A projection of ALTERNATIVE EUR'000 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 ASSETS INVESTED IN LTA INVESTED IN EURASIA INVESTED IN MOLDOVA INVESTED IN ARMENIA INVESTED IN ROMANIA INVESTED IN ITALY SHORT-TERM INVESTMENTS CASH MANAGEMENT EQUITY AND LIABILITIES LIABILITIES EMTNs OTHER LIABILITIES EQUITY NAV Slide 11

12 Structure and management of Mikro Kapital Mikro Kapital Sàrl Luxembourg Asset manager Board of Directors: Vincenzo Trani Marianna Marasco Giorgio Parola Market - Maker Concern General Invest LLC Russia Technical Support Law Firm Consultant Advisory Board Mr.Vittorio Volpi Chairman Edoardo Esercizio Deputy Luxembourg Accountant and NAV calculator Luxembourg auditor audit conseil services Information Agency Credit Committee Assets and Liabilities Committee Calculating and clearing organization BANK PARTNERS Luxembourg Liechtenstein Slide 12

13 Group structure Mikro Luxembourg Kapital Mikro Luxembourg Fund Alternative Luxembourg Fund NATIONAL LEASING Slide 13

14 Group s locations Europe 3 offices Russia 39 offices Milan, Italy Luxembourgy Zurich, Switzerland Moldova 5 offices Chisinau Soroca Balti Drochia Comrat Armenia 2 offices Erevan Romania 3 offices Iasi Brăila Kraiov a Luxembourg Zurich Milan Kaliningrad Grodno Brest Soroca Minsk Kaluga Bryansk Balti Comrat Iasi St.Petersburg Gomel Orel Belgorod Petrozavodsk Chisinau Drochia Moscow Obninsk Tula Nizhny Novgorod Ufa Lipetsk Penza Togliatti Samara Syzran Rostov on Don Astrakhan Krasnodar Erevan Ekaterinburg Moscow (2) St. Petersburg Rostov on Don (2) Kaliningrad Tula Obninsk Ostashkov Krasnodar (3) Lipetsk Astrakhan Orel Pensa Petrozavodsk Kaluga Ludinovo Ekaterinburg (2) Ufa Kazan Nizhny Novgorod (2) Samara Sergievsk Bryansk Buguruslan Buzuluk Dimitrovgrad Pohvistnevo Syzran Togliatti Belgorod Voronezh Stavropol Tambov Izhvesk Belarus 7 offices Minsk Gomel Brest Grodno Mogilev Vitebsk Polozk For more information: apital.com J u

15 Equity and liabilities of ALTERNATIVE (as of ) Structure of liabilities, m 17,0 Obligation/Bonds (Private & Institutional Investors) Equity (Founders & Managers) 7,9 5,5 6,0 6,7 7,7 3,3 3,9 4,0 2,5 0,1 0,1 1,9 2,0 2,0 2,0 2,0 2,1 2,2 2,0 2,9 3,0 Feb2015 March2015 Jun2015 Sept2015 Dec2015 March2016 June2016 Sept2016 Dec2016 Mar2017 Jun2017 Slide 15

16 Alternative fund Group structure Mikro Kapital Founders and Managers 100% Share Capital European Institutional and Private investors 100% EMTNs Preferred Shares Alternative Fund Luxembourg MFIs South and Central America MFIs Africa MFIs East and Central Asia MFI Europe and CSI Countries Italy, Moldova, Romania, Armenia ( Mikro Kapital) Slide 16

17 Section 2 Fund strategy and investment process Slide 17

18 ALTERNATIVE target structure Target Assets Structure Target Equity and Liabilities Structure Expected Return Small and medium-sized companies Leasing companies 50% of assets 20% of assets EMTNs 24 months (quarterly coupon payment) 80m 80% of assets 8% (EMTNs) Microfinance Institutions 20% of assets Cash Instruments 10% of assets NAV (semi-annual dividend payment) 20m 20% of assets 18% (NAV) Slide 18

19 Market entry model Fund Raising Funds, raised in Europe through EMTNs issued in Luxembourg Fund Investment The funds are then channeled to: Institutional clients and then to their final clients (borrowers). Direct clients. Luxembourg Alternative Fund Luxembourg MFIs South and Central America MFIs Africa MFIs East and Central Asia MFI Europa and CSI Countries (Italy, Moldova, Romania, Armenia) Institutional clients Final clients Direct clients Direct clients Direct clients Direct clients Slide 19

20 Sources and investments ( ) Structure of the sources 22,442,683 Structure of assets 22,442,683 Equity 2,982,901 (19,4%) Bonds 16,979,358 (74,2%) Other 2,480,424 Total Liabilities + Equity 22,442, Bondholders 1 Shareholder Average bond amount purchased by one bondholder: 500,000 Investments in EurAsia In total: 4,704,564 Clients: 6,125 Average investments: 768 Investments in LTA In total: 921,959 Clients: 5,713 Average investments: 161 Investments in Moldova In total: 6,443,661 Clients: 749 Average investments: 8,603 Investments in Armenia Short term assets ( 76, 257) Cash ( 6,683,983) In total: 491,630 Clients: 123 Average investments: 3,991 Investments in Romania In total: 2,130,629 Clients: 165 Average investments: 12,913 Investment in Italy is new: 0,99 m Slide 20

21 Section 3 Portfolio analysis Slide 21

22 Where we have invested examples MFO OCHIR UNDRA OMZ NBFI LLC KOPERASI MITRA DHUAFA (KOMIDA) MFO Established in 2008 Established in 2004 Located in Ulaanbaatar, Mongolia 18 employees Located in Jakarta, Indonesia 1373 employees Amount disbursed: 393,600,000 MNT 18 month loan Upfront fee: 1% Interest rate: 17,7% per annum Interest payment: monthly Principal repayment: monthly Amount disbursed: 5,537,600,000 IDR 18 month loan Upfront fee: 1,5% Interest rate: 14% per annum Interest payment: monthly Principal repayment: monthly Slide 22

23 Section 4 Financial equilibrium analysis Slide 23

24 Expected maturity period and bond payments Bond payments Fund's aggregated assets 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 18,97% 0,00% 0,00% 0,00% 0,00% 5,15% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% 0,00% Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Thanks to the strategy of monthly bond commissioning, their maturity dates are not focused on specific events any more, but are distributed through time. Slide 24

25 Assets and liabilities model ( ) Coverage Ratio Total Assets (Expected IN-Flows) EUR ML Total Liabilities (Expected OUT-Flows) EUR ML 0,9x 22,4 19,5 Total Assets (Expected IN - Flows) EUR ML Total Liabilities (Expected OUT-- Flows) EUR ML n/a 0.54x 0.6x 12,1 8,2 8,3 7,4 4,5 0,0 < 1 mth 1-3 mth 4-12mth 1-3 years Mikro Kapital provides on a quarterly basis an updated assets and liabilities model to its investors. This model ensures the balance between the expected outflow (in general of interests and bonds paid to investors) and inflow (in general the loans, paid by entrepreneurs of Russia and Belarus). Coverage rate is between 0,54 0,90x. A repaid loan may be extended Slide 25

26 Section 5 Issues of ALTERNATIVE Fund Slide 26

27 Bond issues month ,375,000 Average rate: 8% Average time:24 months Nominal value:125,000 6 month ,116,000 USD Average rate: 8,5% Average time: 24 months Nominal value: 139,500$ Q ,125,000 Average rate: 8% Average time:24 months Nominal value:125,000 Q ,375,000 Average rate: 8% Average time:24 months Nominal value:125,000 Q ,000 Average rate: 2% Average time:24 months Nominal value:125,000 Q ,125,000 Average rate: 6,9% Average time:30 months Nominal value:125,000 Q ,000,000 Average rate: 5%; 8% Average time:24; 36 months Nominal value:125,000 Q ,830,000 USD Average rate: n.a. Average time:36 months Slide 27

28 EMTNs in Bloomberg An example of Bloomberg page Slide 28

29 Why it is necessary to invest in Mikro Kapital The presence of ALTERNATIVE Fund employees in locations where the investments take place gives a substantial competitive advantage against competitors, so it enables to monitor investments regularly and directly at the locations of the borrowers, as well as encouraging the development of relations with banks and local authorities. Recently the administration of the Fund has been recognised as the developer of the Best Loan Programmes for the financing of small and mid-sized companies in Russia. Generally, the administration consists of foreign personnel, who have been working in Russia for some time and possessing experience in this domain. The product offers a wide diversification of risks to investors from the perspective of the debtor s type, size and geographical location. The investments are not affected by the volatility of the market, because this type of product is not correlated to any other investment instruments on the market (for example: shares, bonds, real estate). This product has a special legal form of western instrument (Luxembourg fund), but in the same time it gives the opportunity to gain access to Emerging Markets and Economies to investors. This product combines with other returns on investments and opportunities to carry out social investments, which will support the development of small and mid-sized company networks and the creation of jobs in some underdeveloped regions of the former Soviet Union. Slide 29

30 Disclaimer This presentation has been drawn solely for the purposes of familiarization with one mode of investment rather than a financial product; it doesn t constitute any offer, as well as it doesn t require representation of offers for the purchasing or selling of products and other services. However, this information and opinions, expressed in this presentation, were received from qualified sources, while we don t undertake any liability or guarantee, obvious or implicit in relation to their accuracy and completeness. Mikro Kapital Sàrl does not provide any legal or tax advices. In such manner, this presentation isn t an advice. Mikro Kapital Sàrl recommends to all entities, interested in some product or service, to receive independent tax or legal advice as well as advices of other character. General information, contained herein shouldn t be considered for your personal investment goals, as well as for your financial situation and financial needs. Some products and services are subject to limitations, that s why they can t be implicitly offered on world level. All the information and opinions, as well as specified indicators may be changed anytime without preliminary notification. This presentation approved and published by Mikro Kapital Sàrl, can t be reproduced or copied without prior consent of Mikro Kapital Sàrl. Slide 30

31 CONTACT Mikro Kapital S.à. r.l. 10, rue C. M. Spoo L Luxembourg G.-D. of Luxembourg