Interim Results for six months ended 30 June 2025
Summary by AI BETAClose X
LEI: 213800TPOS9AM7INH846
INDIA CAPITAL GROWTH FUND LIMITED
Interim Results for the six months ended 30 June 2025
25 September 2025, London - India Capital Growth Fund ("ICGF" or "the Company"), the LSE premium listed investment company established to take advantage of long-term investment opportunities in companies based in India, today reports results for the six months ended 30 June 2025.
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Financial Highlights |
Unaudited 6 months 30 June 2025 |
Audited 12 months 31 Dec 2024 |
% change |
Unaudited 6 months 30 June 2024 |
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Net Asset Value (NAV) total return |
-9.3% |
16.0% |
|
10.6% |
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Share price total return |
-9.6% |
11.3% |
|
4.3% |
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Share price discount to NAV (Discount) |
8.2% |
7.9% |
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9.4% |
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Average month end Discount for the period |
7.9% |
7.7% |
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5.4% |
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Per Ordinary Share |
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Net Asset Value (NAV) |
189.58p |
209.01p |
-9.3% |
199.18p |
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Share price |
174.00p |
192.50p |
-9.6% |
180.50p |
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FX impact |
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Indian Rupee (INR) / Sterling (GBP) |
117.47 |
107.46 |
-9.3% |
105.46 |
· The NAV per share finished the six-month period down 9.3% and the share price similarly was down 9.6%.
· The Discount has been relatively stable over the six-month period ranging from a month end Discount between 11.6% and 4.3% and an average of 7.9%.
· INR weakened 9.3% against GBP over the six months to 30 June 2025, being the main contributing factor to the negative GBP NAV fall in the period.
· The Board monitors the discount closely and has the necessary permissions to repurchase stock if the Board decides it is in the best interests of the Company and its shareholders. 395,000 shares at an average cost of 169.72p per share were purchased in the six month period to 30 June 2025.
· The third Redemption Facility will take place on 28 November 2025 for eligible shareholders on the register on 29 August 2025.
Elisabeth Scott, Chair of India Capital Growth Fund, said:
"The Board is optimistic about the prospects for the Indian economy and for the stock market in India. While there are legitimate concerns about valuations and the speculation taking place in some sectors of the stock market, India's weighting in the emerging markets indices is increasing and foreign investors are, for the most part, underweight.
"Shareholders may have seen the announcement of the upcoming Redemption Facility, which will take place on 28 November 2025. The Board will retain their shares and recommends that all shareholders do the same."
ENQUIRIES
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River Global, Investment Manager Lucy Draper, Robin Sellers
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Shore Capital, Financial Adviser and Broker Gillian Martin, Daphne Zhang (Corporate Advisory)
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Apex Fund and Corporate Services (Guernsey) Limited (Company Secretary) |
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About India Capital Growth Fund
India Capital Growth Fund Limited the London Stock Exchange's Main Market listed investment company registered and incorporated in Guernsey, was established to take advantage of long-term investment opportunities in companies based in India. ICGF predominantly invests in listed mid and small cap companies, although investments may also be made in large cap and private Indian companies where the Fund Manager believes long-term capital appreciation will be achieved. www.indiacapitalgrowth.com
HIGHLIGHTS
Financial highlights for the period from 1 January to 30 June 2025
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-9.3% |
Net Asset Value per share total return of -9.3% (2024: +10.6%)
The Net Asset Value (NAV) per share total return for the six months to 30 June 2025 was negative 9.3% (six months to 30 June 2024: +10.6%). This is in comparison to the Notional Benchmark BSE Midcap Total Return Index which was negative 7.4% (six months to 30 June 2024: +26.7%) for the same period.
The NAV per share total return is the theoretical return to shareholders calculated on a per share basis based upon the increase or decrease in the NAV over the relevant year. The BSE Midcap Total Return Index (Index) return is based upon the increase or decrease in the published Index converted to GBP over the relevant year.
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-9.6%
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Shareholder total return of -9.6% (2024: +4.3%)
The shareholder total return for the six months to 30 June 2025 was negative 9.6% (six months to 30 June 2024: +4.3%). The share price on 30 June 2025 was 174.0p (30 June 2024: 180.5p).
The shareholder total return is the theoretical return to shareholders calculated on a per share basis based upon the increase or decrease in the share price over the relevant year.
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8.2% |
Shares ended the period at a discount of 8.2% (2024: 9.4%)
The shares traded at a month end average discount to NAV of 7.9% over the six months to 30 June 2025 (six months to 30 June 2024: 7.5%).
The discount is shown as a percentage to NAV and is calculated based upon the difference between the Company's NAV and share price. The average discount is based upon the published month end discount for the six month period.
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-9.3% |
Indian Rupee (INR) value compared to Pound Sterling (GBP) decreased 9.3% (2024: +0.6%)
The value of INR compared to GBP decreased 9.3% over the six months to 30 June 2025 (six months to 30 June 2024: increased 0.6%). The INR/GBP exchange rate on 30 June 2025 was 117.47 (30 June 2024: 105.46).
The majority of the Company's assets and investments are held in INR whereas the currency of the Company's NAV is GBP. Consequently, any increase or decrease in the value of INR compared to GBP will respectively have a positive or negative impact on the Company's NAV. The Company's long standing policy is not to hedge the GBP value of its INR assets and investments.
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CHAIR'S STATEMENT
When I wrote my statement for the half yearly report last year, the news cycle had been dominated by the Indian General Election and the impact of the BJP and Modi's less than emphatic victory. In the first half of 2025, all eyes (at least since April) have been on the USA and the possible effects of President Trump's tariffs. Following a terrorist attack which killed 26 tourists in Kashmir, Indian military forces struck targets in Pakistan. There were concerns that this could lead to an escalation of the conflict. Fortunately, both sides stepped back and, at the time of writing, there have been no further incidents.
Performance
The Net Asset Value (NAV) of the shares in your Company fell by 9.3%, underperforming the benchmark index, which declined by 7.4%. As the Investment Manager's report explains in detail, unsurprisingly Indian companies exposed to export markets were hit hard by nervousness about the possibility of the introduction of tariffs. The Indian Rupee fell by 9.3% against Sterling, driven in part by a reduction in interest rates. The Company's share price fell by 9.6% over the period.
Discount management and upcoming redemption facility
The discount of the share price to NAV widened very slightly from 7.9% at 31 December 2024 to 8.2% at 30 June 2024. The Board monitors the discount/premium closely and has the necessary permissions to repurchase or issue shares if the Board decides it is in the best interests of the Company and its shareholders. During the period 395,000 shares were repurchased. Since the period end, a further 86,000 shares have been repurchased.
Shareholders may have seen the announcement of the upcoming Redemption Facility, which will take place on 28 November 2025. Previous redemptions have taken place at calendar year end, but the Board understands that this timing was not ideal, so a decision was taken to bring the redemption forward by a month. All shareholders of record at 29 August are eligible to redeem their shares at an exit discount of 3%. The Board will retain their shares and recommends that all shareholders do the same. For the avoidance of doubt, unless you wish to redeem your shares under the redemption facility, no shareholder action is required.
Investor relations
The Board's focus on ensuring that we communicate with shareholders as effectively as possible remains in place. We were delighted to have the opportunity to meet a number of you at our AGM in June, the first time we had held our AGM in London. We were grateful to H/Advisors Maitland for hosting us in their spectacular Kings Cross offices, and for providing an excellent Indian buffet after the formal meeting had taken place, and, of course, to Gaurav Narain and the team for providing such an insightful presentation.
We continue to place a great deal of emphasis on expanding the reach of the Company. So far this year, there have been a number of articles in the press and in the remainder of the year, Gaurav will participate in a number of conferences in the autumn and the Investment Manager hosts regular webinars during the year.
I encourage shareholders who have not yet taken advantage of these webinars to sign up for updates on the India Capital Growth website www.indiacapitalgrowth.com.
Looking forward
Despite the current geopolitical uncertainty, the Board is optimistic about the prospects for the Indian economy and for the stock market in India. While there are legitimate concerns about valuations and the speculation taking place in some sectors of the stock market, India's weighting in the emerging markets indices is increasing and foreign investors are, for the most part, underweight, and have room to increase their positions.
Thank you for your support. The Board is confident that the Investment Manager's strategy and positioning of the portfolio will stand us in good stead.
INVESTMENT MANAGER'S REVIEW
The Company's Net Asset Value (NAV) declined by 9.3% (in GBP) in the first six months of the year mainly because of a weakening India Rupee which fell by 9.3% against Sterling in this period. Although the Company marginally underperformed the BSE Midcap TR Index (the Benchmark), which fell by 7.4% (in GBP) in the same period, we are pleased to report the performance of the portfolio in the mid and long term remains strong: The NAV increased 64.9% and 169.2% in the three years and five years to 30 June 2025 respectively.
Portfolio Performance
India Capital Growth Fund is focused on investing in high-quality small and mid-cap companies within the Indian equity market. As of the latest reporting period, approximately 62% of the portfolio is allocated to small-cap stocks and 31% to mid-cap stocks. The fund adheres to a long-term investment philosophy, targeting businesses with strong fundamentals and sustainable growth potential. This approach is reflected in the portfolio's stability, with approximately 60% of holdings retained for more than five years and a consistently low turnover rate. The portfolio currently comprises 37 stocks.
The first half of 2025 was characterised by significant market volatility. During the January to March quarter, mid and small-cap indices experienced sharp corrections, with the BSE Mid-Cap Index declining by 10.4% and the BSE Small-Cap Index falling by 15.5% in INR terms. In contrast, the large-cap BSE Sensex registered a modest decline of 0.9%. These movements were driven by weak earnings growth and increased investor risk aversion, largely influenced by tariff-related uncertainty under the Trump administration, which triggered foreign institutional investor (FII) outflows totalling US$14 billion in this period. Markets rebounded in the April to June quarter, recovering the earlier losses. As a result, mid and small-cap indices ended the half-year broadly flat, while the BSE Sensex closed the period in positive territory.
The fund's NAV declined by 9.3% during the period, underperforming its benchmark by 1.9%. A substantial portion of this decline was attributable to currency depreciation, with the Indian Rupee weakening by 9.3% against Sterling. In INR terms, the NAV registered a modest decline of 0.9%. Sector-wise, financials contributed positively to performance. Following a challenging 2024, marked by tighter liquidity and lending norms imposed by Reserve Bank of India, the sector rebounded strongly in response to policy reversals and interest rate cuts. RBL Bank led the performance of the banks with a 58% gain. Other strong performers were spread across sectors, led by MCX up 41%, CCL Products up 15% and both our digital holdings - Cartrade and Affle, which were up 11% each.
Conversely, export-oriented businesses-comprising approximately 35% of the portfolio-faced significant headwinds due to global macro uncertainty, delayed decision-making cycles, and muted earnings visibility. Auto ancillary and textile companies were particularly affected, while IT services demonstrated relative resilient, having thus far avoided direct exposure to tariffs. Dixon Technologies, one of our largest holdings, declined by 17% amid concerns over the potential impact of tariffs on electronic exports.
During the period, two new positions were initiated. Titagarh Rail Systems, a leading manufacturer of railway wagons, has entered into the passenger rail segment and secured a robust order book for metro and coach manufacturing. With high entry barriers and limited private sector competition, the company is well-positioned to benefit from structural upgrades in India's rail infrastructure. Coforge, a fast-growing IT services firm, was added to the portfolio based on its differentiated market positioning and early adoption of AI technology, which have translated into new business wins and a robust pipeline. The fund also increased exposure to EPL, Elecon, Triveni, Kajaria, and Balkrishna Industries, capitalising on price dislocations.
During the period, we exited Vedant Fashions due to slowing growth and valuation concerns. Partial profit was booked in Federal Bank, MCX, PSP Projects, Neuland Laboratories, Skipper, and Persistent Systems to manage position sizes and respond to prevailing market volatility.
The fund currently holds 5.6% in cash. Given that valuations remain above historical averages and macroeconomic conditions continue to be fluid, we anticipate ongoing volatility in the near term. We remain focused on bottom-up stock selection and disciplined portfolio construction to navigate this environment.
Economy
India has emerged as the fastest-growing large economy post-COVID, with real GDP expanding at 8.8% p.a. over FY2021-2024. This strong economic momentum translated into robust corporate earnings, which grew an average of over 20% annually during the period. However, growth moderated in 2024, primarily due to election-related disruptions and inflation weakness which dampened rural consumption. The slowdown was viewed as temporary, particularly following the re-election of the Modi government, which signalled policy continuity and reinforced investor confidence in 2025.
India's GDP growth recovered in the first half of 2025, yet corporate earnings remained subdued, registering single-digit growth for the fifth consecutive quarter. This stagnation persisted despite a pro-growth Union Budget in February 2025, which included substantial infrastructure spending and personal tax cuts. Several unforeseen factors dampened economic momentum: an early monsoon disrupted construction and seasonal consumption patterns, while geopolitical tensions, including Trump-era tariffs, renewed India-Pakistan conflict, and the Israel-Iran crisis, contributed to delays in travel and decision-making.
Despite these challenges, industrial activity has shown signs of recovery, although consumption remains sluggish. There is cautious optimism for a domestic revival supported by a favourable monsoon that is expected to boost rural incomes. The government's next phase of reforms, including rationalisation of the goods and Services Tax (GST), aims to stimulate demand and simplify compliance. Additionally, anticipated tax cuts in key consumption sectors such as automobiles ahead of the festive season could further stimulate growth. The infrastructure pipeline also remains robust.
The primary drag on growth stems from an increasingly uncertain global environment. The imposition of U.S. tariffs was particularly disappointing, given the progress made on a bilateral trade deal and the strong rapport between Prime Minister Modi and President Trump. India now faces some of the highest tariff barriers globally, adding to investor anxiety. Nevertheless, India's economy remains more domestically driven than many of its emerging market peers, and key export sectors- such as IT services, pharmaceuticals, and electronics-have largely been insulated from external challenges. Labour-intensive and U.S. dependent sectors including textiles, gems and jewellery, auto ancillaries, and aquaculture, remain vulnerable. Their performance could determine whether India's GDP growth remains at the lower end of the projected 6-7% p.a. forecast range.
On a positive note, India's macroeconomic fundamentals remain strong. Inflation is near record lows, interest rates have been reduced by 1%, and foreign exchange reserves stand at approximately $700 billion-providing 11 months of import cover. The fiscal position is stable, affording the government flexibility to navigate external volatility and support domestic growth.
Stock Markets
Following three years of strong performance, Indian equity markets underperformed global peers in the first half of 2025-delivering flat returns in INR terms and negative returns in GBP. Elevated valuations, coupled with muted earnings growth led foreign investors to remain mainly on the sidelines.
Beneath the surface, the Indian Equity market is undergoing a quiet but significant transformation. Domestic institutional investors and retail investors have emerged as the primary market drivers, contributing sustained monthly inflows of $3-4 billion. As a result, domestic ownership has now surpassed that of foreign institutional investors (FIIs), and the scale of inflows has created challenges around effective liquidity deployment.
This surplus liquidity is fuelling a vibrant IPO pipeline, secondary share sales by promoters, and strategic stake divestments by multinational corporations looking to capitalise on premium valuations. These developments have broadened market depth and enhanced the system's capacity to absorb liquidity.
A key question facing the market is whether the current pace of inflows will be sustained. Evidence points to a structural shift in household savings behaviour-from traditional hard assets such as property and gold to financial instruments. This transition is largely driven by small-ticket retail investments, through monthly systematic investment plans (SIPs).
While market valuations have eased from their peaks, earnings growth continues to fall short of expectations. Following six months of flat returns, India's relative premium to Emerging Markets has reverted to its long term historical average. However, in absolute terms, it still trades at a notable premium.
Themes reflected in Portfolio holdings
Digitalisation
CarTrade Technologies
India's leading online classified platform
India has experienced rapid growth in digital adoption and mobile penetration, fundamentally reshaping consumer behaviour across industries. In the automobile industry, this transformation is evident with over 90% of buyers conducting online research before visiting a showroom, often relying on third-party platforms. CarTrade Technologies (CarTrade) is a leading player in this space, operating an asset-light and profitable model across multiple segments with the online automobile classifieds market.
CarTrade operations are structured around three primary verticals: i) consumer platforms such as CarWale and BikeWale, ii) OLX India, the country's largest classifieds platform and iii) Shiram Auto Mall, which focusses on vehicle remarketing and auctions. These segments contribute almost equally to the company's revenue, with strong profitability reflected in consolidated EBITDA margins of approximately 27%.
The consumer segment offers auto manufacturers (OEMs) and dealers a range of solutions, including lead generation, digital campaigns for new launches, brand building, and consumer insights. As auto companies steadily continue to increase their digital marketing budgets, this segment has grown at a 25% CAGR over the last three years, well ahead of overall industry averages and is expected to maintain a growth rate of around 20% annually. The acquisition of OLX in 2023 further strengthened CarTrade's position in used vehicle classified adverts, while also enabling diversification into adjacent categories such as electronics, real estate, and mobile phones.
The remarketing business, which facilitates vehicle auctions, has grown modestly at 3% CAGR but is now accelerating, supported by an increasing share of vehicles sourced directly from retail channels. CarTrade manages over 135 yards across 90 cities and forecasts 12-15% p.a. growth in this segment going forward.
With approximately 70 million monthly unique visitors-90% of whom are organic-CarTrade maintains a lean marketing spend at just 5% of revenue. Its asset-light, high operating leverage model drove FY25 revenue growth of 31% and profit growth of 74%. Reflecting this strength, the stock surged 155% over the past year. While we retain high conviction in CarTrade's ability to compound value amid India's accelerating digital transformation, we have partially realised gains within the portfolio.
Consumption
CCL Products Ltd
One of the world's largest private label instant coffee manufacturers.
If you step into Tesco, Sainsbury's, or Waitrose, there's a strong chance the private label instant coffee on the shelf is manufactured by CCL Products (India) Ltd. With a significant customer base exceeding 400 brands, coffee chains and supermarkets, a portfolio of over 1,000+ blends, and a presence in more than 100 countries, CCL is the world's largest exporter of instant coffee and a leading private label manufacturing.
The company operates four manufacturing facilities across India, Vietnam, and Switzerland, producing a wide comprehensive range of coffee formats-including spray-dried, freeze-dried, liquid, and specialty coffees-tailored to the needs of private labels and institutional clients globally. CCL sources coffee beans from multiple origins and employs a cost-plus pricing model, which insulates from raw material price volatility.
Exports account for over 85% of revenues, with Europe contributing 35-40%. The company's ability to deliver customised blends fosters strong customer loyalty, and with orders typically placed 6-12 months in advance, the business benefits from strong revenue visibility.
In the domestic market, CCL has expanded into the branded segment through its Continental Coffee label, which now contributes approximately 10% of revenues. It is currently the third-largest instant coffee brand in India, with a market share of 3-4%. In 2023, CCL expanded its premium offering by acquiring the UK-based Percol brand and launching it in India. The branded business has already achieved breakeven and is growing at 30%+ annually.
Financially, CCL has delivered resilient performance, with sales and net profit growing at 29% and 18% CAGR, respectively, over the past three years. Supported by a robust operating model and an expanding global footprint, the company is well-positioned for sustained growth. Management has guided for 10-20% annual volume growth and 15-20% EBITDA growth over the medium term. The stock has returned 44% over the last 12 months, reflecting strong investor confidence in its trajectory.
Make in India
Titagarh Rail Systems
India's largest manufacturer of railway wagons in the Private Sector.
In recent years, the Indian government has significantly increased capital expenditure, with infrastructure development, particularly in the Railways sector, a key priority. Over the past decade, capital expenditure on Indian Railways has increased more than fivefold to approximately $31 billion in FY25. These investments span critical areas such as track doubling, electrification, and the procurement of new wagons and coaches for both passenger rail and metro services. To modernize the passenger segment, Indian Railways has introduced advanced coaches and expanded its network. This significant increase in spending has revived private sector interest in the railway industry.
Titagarh Rail Systems (Titagarh) is the largest rail wagon manufacturer in India, commanding a 20% market share. Leveraging the government's increased infrastructure spending, Titagarh has successfully expanded into the production of metro and passenger coaches, greatly broadening its market potential. This segment is characterised by high entry barriers due to complex technology and limited competition, with only three players currently active. With its wagon business providing stable cash flow, Titagarh is strategically focused on growing its passenger segment.
To strengthen its competitive position, the company is vertically integrating by manufacturing wheels and propulsion systems in-house. Its current order book, valued at more than three times its historical revenue, underscores strong growth prospects. Notably, more than two-thirds of its $1.5 billion order book is attributable to the passenger segment. To meet this growing demand, Titagarh plans to more than double its capacity from 300 coaches currently to 840 coaches by FY27. The passenger segment is expected to contribute approximately 35% of total revenue by FY28, up from just 11% in FY24. With the right investments and technological advancements, Titagarh aims to evolve into a comprehensive rail transportation company, offering both wagons and passenger coaches.
Titagarh is a recent entrant in India Capital Growth Fund. Despite recent underperformance, we see it as a long-term holding.
PRINCIPAL INVESTMENTS
As at 30 June 2025
|
Holding |
Market cap size |
Sector |
Value £000 |
% of Portfolio |
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Multi Commodity Exchange |
M |
Financial Services |
8,832 |
5.1% |
|
Skipper |
S |
Industrials |
8,191 |
4.8% |
|
Federal Bank |
M |
Financial Banks |
7,820 |
4.6% |
|
Dixon Technologies |
M |
Consumer Discretionary |
7,475 |
4.4% |
|
Neuland Laboratories |
S |
Healthcare |
6,995 |
4.1% |
|
RBL Bank |
S |
Financial Banks |
6,980 |
4.1% |
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Affle India |
S |
Digital |
6,634 |
3.9% |
|
Persistent Systems |
M |
IT Services |
6,405 |
3.7% |
|
Emami |
S |
Consumer Staples |
6,130 |
3.5% |
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PI Industries |
M |
Chemicals |
5,766 |
3.4% |
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IDFC Bank |
M |
Financial Banks |
5,684 |
3.3% |
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City Union Bank |
S |
Financial Banks |
5,297 |
3.1% |
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CCL Products India |
S |
Consumer Staples |
5,264 |
3.1% |
|
JK Lakshmi Cement |
S |
Cement |
4,770 |
2.8% |
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Ramkrishna Forgings |
S |
Auto & Auto Ancillary |
4,593 |
2.7% |
|
VIP Industries |
S |
Consumer Discretionary |
4,083 |
2.4% |
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Sona BLW Precision Forgings |
S |
Auto & Auto Ancillary |
3,986 |
2.3% |
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Cartrade Technologies |
S |
Digital |
3,890 |
2.3% |
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Welspun India |
S |
Textiles |
3,722 |
2.2% |
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Gokaldas Exports |
S |
Textiles |
3,570 |
2.1% |
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Total top 20 portfolio investments |
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116,087 |
67.9% |
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Investments may be held by the Company and its Mauritian subsidiary, ICG Q Limited.
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Market capitalisation size definitions for the six months to 30 June 2025*: |
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L: Large cap - companies with a market capitalisation above US$12bn |
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M: Mid cap - companies with a market capitalisation between US$4bn and US$12bn |
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S: Small cap - companies with a market capitalisation below US$4bn |
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*based on the classifications adopted by the Association of Mutual Funds in India (AMFI), which is mandated by the Securities and Exchange Board of India (SEBI) to define large, mid, and small-cap companies
PORTFOLIO STATEMENT
As at 30 June 2025
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HOLDING |
Market cap |
Nominal |
Value |
% of |
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LISTED SECURITIES |
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Auto & Auto Ancillary |
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Balkrishna Industries |
M |
155,000 |
3,227 |
1.9% |
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Ramkrishna Forgings |
S |
800,000 |
4,593 |
2.7% |
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Sona BLW Precision Forgings |
S |
972,714 |
3,986 |
2.3% |
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Uniparts India |
S |
562,237 |
1,908 |
1.1% |
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13,714 |
8.0% |
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Cement |
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JK Lakshmi Cement |
S |
623,000 |
4,770 |
2.8% |
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Sagar Cements |
S |
1,611,000 |
3,281 |
1.9% |
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8,051 |
4.7% |
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Chemicals |
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Aether Industries |
S |
417,124 |
2,705 |
1.5% |
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PI Industries |
M |
165,000 |
5,766 |
3.4% |
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8,471 |
4.9% |
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Consumer Discretionary |
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Bajaj Electricals |
S |
348,734 |
2,044 |
1.2% |
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Dixon Technologies |
M |
58,600 |
7,475 |
4.4% |
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Kajaria Ceramics |
S |
365,698 |
3,365 |
1.9% |
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VIP Industries |
S |
1,138,853 |
4,083 |
2.4% |
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16,967 |
9.9% |
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Consumer Staples |
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CCL Products India |
S |
727,883 |
5,264 |
3.1% |
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Emami |
S |
1,259,764 |
6,130 |
3.5% |
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Essel Propack |
S |
1,498,332 |
3,107 |
1.8% |
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Jyothy Laboratories |
S |
742,000 |
2,187 |
1.3% |
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16,688 |
9.7% |
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Digital |
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Affle India |
S |
390,000 |
6,634 |
3.9% |
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Cartrade Technologies |
S |
268,671 |
3,890 |
2.2% |
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10,524 |
6.1% |
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Financial Banks |
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City Union Bank |
S |
2,845,000 |
5,297 |
3.1% |
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IDFC Bank |
M |
9,167,000 |
5,684 |
3.3% |
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Indusind Bank |
M |
224,000 |
1,663 |
1.0% |
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RBL Bank |
S |
3,300,000 |
6,980 |
4.1% |
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Federal Bank |
M |
4,310,000 |
7,820 |
4.5% |
|
|||
|
|
|
|
27,444 |
16.0% |
|
|||
|
Financial NBFC |
|
|
|
|
||||
|
Cholamandalam Investment and Finance Company |
L |
175,000 |
2,425 |
1.4% |
||||
|
|
|
|
2,425 |
1.4% |
||||
|
Financial Services |
|
|
|
|
||||
|
Multi Commodity Exchange |
M |
116,000 |
8,832 |
5.1% |
||||
|
|
|
|
8,832 |
5.1% |
||||
|
Healthcare |
|
|
|
|
||||
|
GPT Healthcare |
S |
2,200,000 |
2,716 |
1.6% |
||||
|
Neuland Laboratories |
S |
68,475 |
6,995 |
4.1% |
||||
|
|
|
|
9,711 |
5.7% |
||||
|
Industrials |
|
|
|
|
||||
|
Container Corporation of India |
M |
418,000 |
2,704 |
1.6% |
||||
|
Elecon Engineering |
S |
623,432 |
3,475 |
2.0% |
||||
|
PSP Projects |
S |
403,574 |
2,611 |
1.5% |
||||
|
Skipper |
S |
1,893,823 |
8,191 |
4.8% |
||||
|
Titagarh Rail Systems |
S |
304,462 |
2,444 |
1.5% |
||||
|
Triveni Turbine |
S |
606,113 |
3,160 |
1.8% |
||||
|
|
|
|
22,585 |
13.2% |
||||
|
IT Services |
|
|
|
|
||||
|
Coforge |
M |
175,000 |
2,867 |
1.7% |
||||
|
Persistent Systems |
M |
124,536 |
6,405 |
3.7% |
||||
|
|
|
|
9,272 |
5.4% |
||||
|
Textiles |
|
|
|
|
||||
|
Gokaldas Exports |
S |
465,826 |
3,570 |
2.1% |
||||
|
Welspun India |
S |
3,050,000 |
3,722 |
2.2% |
||||
|
|
|
|
7,292 |
4.3% |
||||
|
|
|
|
|
|
||||
|
Total equity investments (including those held by ICG Q Limited) |
161,976 |
94.4% |
||||||
|
Cash less other net current liabilities |
|
9,689 |
5.6% |
|
||||
|
Total Net Assets (before deferred taxation for Indian CGT) |
171,665 |
100.0% |
|
|||||
|
|
|
|
|
|||||
|
Deferred tax provision for Indian CGT |
|
(9,733) |
|
|
||||
|
Total Net Assets (after deferred tax provision for India CGT) |
161,932 |
|
|
|||||
|
Notes: |
|
|
|
|
L: Large cap - companies with a market capitalisation above US$12bn |
1.4% |
||
|
M: Mid cap - companies with a market capitalisation between US$4bn and US$12bn |
30.6% |
||
|
S: Small cap - companies with a market capitalisation below US$4bn |
62.4% |
||
|
|
94.4% |
||
Equity investments may be held by the Company and its Mauritian subsidiary, ICG Q Limited.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE STATEMENT
The Board recognises its responsibilities for reporting on ESG and regularly engages with the Investment Manager, upon whom the Board is reliant to deliver this ESG reporting of the Company and to implement its ESG strategy. In this regard the Board attended a presentation by the Investment Manager on the implementation of its ESG policy and how it has developed a bespoke ESG scoring model to monitor and report upon ESG factors of the investment portfolio. The Board is informed of the progress of this reporting at least annually when it prepares the ESG Report for the Annual Report. The Board also visits India with the Investment Manager during which they attend meetings with investee companies to hear first-hand on how these companies are implementing ESG factors into their business processes and reporting in India.
The Company reports in line with the Listing Rules and is a Guernsey structure and therefore is not required to comply with the Task Force on Climate-related Financial Disclosures (TCFD). However, the Board is mindful of TCFD disclosure guidance and in particular the core content of Governance, Strategy, Risk Management and Metrics & Targets when reporting on ESG matters. The Company entity itself is an investment company with no employees so has limited climate related risk, nonetheless the Board is mindful of the climate related impact of air travel to Board Meetings and therefore only travels in accordance with required regulations.
In setting and reporting on our ESG policies, we have considered the impacts of our activities and followed the relevant regulatory guidance including the requirements of section 172(1) of the Companies Act 2006 and, in so far as they apply, the non-financial reporting requirements in sections 414CA and 414CB of the Companies Act 2006. Although India Capital Growth Fund does not fall within the scope of these two sections, we believe that these disclosures will provide shareholders and stakeholders with a greater level of insight and transparency. We have also reported under the UK Corporate Governance Code ("UK Code").
The Board believes in engagement and long-term ownership both in respect of our own shareholders and the investment approach adopted by our Investment Manager, to drive investment performance and to contribute to positive change to build a sustainable future. We and our Investment Manager believe that companies with strong management and a focus on ESG have the potential to reduce risks facing their business, thereby delivering sustainable performance and enhanced returns over the longer-term.
Investment management approach to sustainability & ESG
The management of sustainability risks forms an important part of the investment portfolio due diligence process implemented by the Investment Manager. When assessing the sustainability risks associated with underlying investments, the Investment Manager is assessing the risk that the value of such underlying investments could be materially negatively impacted by an environmental, social or governance event or condition. Sustainability risks are incorporated into the Investment Manager's evaluation of an issuer's investment risk or return, across all the Company's investments.
The Investment Manager has made ESG matters an integral part of its due diligence process over the last three years. The Board and the Investment Manager believe that sound governance is an essential element of a company's long-term sustainability and growth, and that detailed analysis beyond financial data is required to understand the true characteristics of a potential underlying investment. This includes, but is not limited to, conviction in the alignment of interest between the owners, managers and minority shareholders of a business, the nature and extent of the true independence of the Board and its specialist sub-committees, capital allocation and dividend policies, tax treatment, key man risk and succession planning. Governance plays a central role in the investment philosophy of the Investment Manager, and it naturally veers away from certain companies where practical issues of "getting business done" within India can undermine good governance. These companies tend to be capital intensive, rely on multiple bureaucratic approvals for authorisation and are often cash flow negative. The Investment Manager also will not consider investments in industries that are considered harmful to the wellbeing of society not least because they may not demonstrate adequate compliance with regulations and tax considerations which may create unforeseen financial uncertainty. These include tobacco, alcohol, gambling and defence equipment manufacturers of all descriptions.
The Investment Manager values non-financial factors, such as environmental and social issues, when evaluating a company for investment. These factors include gender diversity, environmental impact, carbon footprint, workplace health and community engagement. If the sustainability risks exceed the risk appetite of the Company, the Investment Manager may sell or reduce exposure to protect shareholders' interests.
Social factors considered in the ESG assessment include:
· Fulfilment of responsibilities under Corporate Social Responsibility requirements
· Human capital: employee turnover, health & safety, training & diversity, treatment of blue collar workers
· Human rights and community relations
· Customer privacy and data security
· Access and affordability
· Product quality and safety
· Supply chain management
· Customer welfare
· Selling practices and product labelling
Additionally, as part of its commitment to ESG & sustainability in its investment approach, the Investment Manager is a signatory to the UN Principles of Responsible Investing and has appointed a dedicated ESG co-ordinator to implement its ESG investment strategy.
Engagement
To gain a comprehensive understanding of the ESG and sustainability practices of portfolio companies, the Investment Manager prioritises constructive dialogue with management. The investment advisers in India regularly engage with both current and potential portfolio companies, conducting onsite visits to manufacturing facilities and corporate headquarters to gather insights and build a clear picture. Additionally, they strive to meet employees beyond the senior management team to ensure that the ESG, and sustainability values promoted by senior management are reflected throughout the organisation.
The Investment Manager has noted over the past two years that there has been a substantial improvement in ESG practices and disclosure standards being followed by Indian companies. There is a growing recognition within corporates that poor ESG disclosure and practices could be a significant business risk, while good ESG practices act as a competitive advantage and lead to improved market valuations. This is reflected in improved level of disclosures in corporate presentations on ESG goals and progress made.
The regulatory environment is also getting tighter. SEBI has introduced the Business Responsibility and Sustainability Reporting (BRSR) regulations which is a comprehensive disclosure framework that helps companies disclose their ESG-related information in India. BRSR came into effect in 2021 and since FY 2023, it is mandatory for the top 1000 listed entities in India to report under this framework. This is enabling a better relative comparison within companies in a sector and has resulted in engagement meeting presentations from both investee companies and potential portfolio holdings giving substantial coverage to ESG matters such that direct engagement to drive ESG reporting improvements has, in general, not been necessary in FY 2024. The Investment manager believes the quality of data being reported is improving each year which is reflected in the improved ESG scoring of the portfolio referred to above.
Voting on portfolio investments
Please refer to the 2024 Annual Report for details regarding voting on portfolio investments, and examples of such voting practices.
DIRECTORS' INFORMATION
The Directors as at 30 June 2025, all of whom are non-executive, are as follows:
Elisabeth Scott (Chair)
Elisabeth was appointed to the Board as Chair on 18 December 2017. She has 40 years' experience in the asset management industry, having started her career in Edinburgh in the 1980s, then moving to Hong Kong in 1992 where she remained until 2008, latterly in the role of Managing Director and Country Head of Schroder Investment Management (Hong Kong) Limited. She is a Non-Executive Director of BlackRock World Mining Trust plc, and Chair of JPMorgan Global Emerging Markets Income Trust plc and a former Chair of the Association of Investment Companies (AIC). She is resident in the UK.
Patrick Firth
Patrick was appointed to the Board in September 2020. He qualified as a Chartered Accountant with KPMG Guernsey in 1991 and is also a member of the Chartered Institute for Securities and Investment. He worked in the fund industry in Guernsey since joining Rothschild Asset Management C.I. Limited in 1992 before moving to become managing director at Butterfield Fund Services (Guernsey) Limited (subsequently Butterfield Fulcrum Group (Guernsey) Limited), a company providing third party fund administration services, where he worked from April 2002 until June 2009. Patrick is a former Chairman of the Guernsey International Business Association and of the Guernsey Investment Fund Association. He is a Non-Executive Director of CT UK Capital and Income Investment Trust plc. and VH Global Energy Infrastructure plc. He is resident in the UK.
Lynne Duquemin
Lynne was appointed to the board in May 2021. She has over 35 years' experience in financial markets, initially in London in the late 1980's before being seconded by Credit Suisse to Guernsey, Channel Islands in 1995. Since 2020 she has led the investment arm of a Single Family Office in Guernsey, as their Chief Investment Officer. Prior to which she worked for twelve years as an Investment Consultant for an Independent Investment Consultancy. She is a Fellow of the Chartered Institute for Securities and Investment and a Chartered Wealth Manager. She is also an ASIP qualified member of the CFA UK member of the CFA, 953214, as well as a Chartered Director and Fellow of the Institute of Directors. Lynne is a Director of several private companies, including a global operating company and has prior experience as a Non-Executive Director of a listed Frontier Equities Investment Company. She is based in Guernsey, Channel Islands.
Nick Timberlake
Nick was appointed to the Board in July 2022. He has over 30 years' experience in the asset management industry as a Portfolio Manager, he was with HSBC Global Asset Management between 2005 and 2020, initially as Global Head of Emerging Markets Equities and then Head of Equities. Previously he was a Director of F&C Investment Management and has spent the last 20 years investing in global emerging markets equities. He is a non-executive director of Aberdeen Equity Income Trust, CT Automotive plc and a partner in Panorama Property Investments LLP. Nick is a member of the CFA Institute and CFA Society of the UK. He is resident in the UK.
The following summarises the Directors' directorships in public companies and other relevant entities:
|
|
Company Name |
Stock Exchange |
|
|
|
|
|
Elisabeth Scott |
BlackRock World Mining Trust plc |
London |
|
|
JP Morgan Global Emerging Markets Income Trust plc |
London |
|
|
|
|
|
Patrick Firth |
CT UK Capital and Income Investment Trust plc |
London |
|
|
VH Global Energy Infrastructure plc |
London |
|
|
|
|
|
Lynne Duquemin |
- |
- |
|
|
|
|
|
Nick Timberlake |
Aberdeen Equity Income Trust plc |
London |
|
|
CT Automotive plc |
London |
DIRECTORS' REPORT
The Directors present their interim report and the unaudited condensed financial statements of the Company for the period from 1 January 2025 to 30 June 2025.
The Company
India Capital Growth Fund Limited (the "Company") was registered in Guernsey on 11 November 2005 and is a closed-ended investment company with its shares admitted to trading on the main market of the London Stock Exchange. The Company's objective is to provide long-term capital appreciation by investing in companies based in India. The Company's registration number is 1030287. At 30 June 2025, the Company has one wholly owned Mauritian subsidiary, ICG Q Limited ("ICG Q"). The Company has an unlimited life, although a Redemption Facility has been put in place following the passing of a shareholders' resolution at a General Meeting on 12 June 2020. The first date at which shareholders were able to request the redemption of some or all of their shares was 31 December 2021 when 15,408,872 net shares were redeemed under the Redemption Facility. The second date was 31 December 2023 when 15,159,876 net shares were redeemed under the Redemption Facility. Under this facility the next date at which shareholders will be able to request the redemption of some or all of the shares will be on 28 November 2025 for shareholders on the register on 29 August 2025, as approved by shareholders at the Company's AGM on 5 June 2025.
Group structure
The Board of Directors continues to take steps to close down and to liquidate its Mauritian subsidiary, ICG Q, given it no longer serves a beneficial purpose for the Company's shareholders. However, this process may take some considerable time given the restrictions imposed by the Indian regulators on transferring listed Indian equities from one entity to another without incurring considerable costs and risk. The Board does not believe this is in the interest of the shareholders. In the meantime, the Investment Manager has moved Indian Rupee ("INR") cash balances held by the Group's custodian from ICG Q to the Company and has committed that all future purchases for the investment portfolio will only be made by the Company, unless it is in shareholders' interests to do otherwise.
Details of the authorised and issued share capital, together with details of the movements in the Company's issued share capital during the period are shown in note 8. The Company has one class of ordinary shares which carry no right to fixed income. Each share carries the right to one vote at general meetings of the Company.
There are no specific restrictions on the size of a holding nor on the transfer of shares, which are both governed by the general provisions of the Articles of Association and prevailing legislation. The directors are not aware of any agreements between holders of the Company's shares that may result in restrictions on the transfer of securities or on voting rights.
Investment policy
The Company's investment objective is to provide long-term capital appreciation by investing in companies based in India. The investment policy permits the Company to make investments in a range of Indian equity and equity-linked securities and predominantly in listed mid and small cap Indian companies with a smaller proportion in unlisted Indian companies. Investment may also be made in large cap listed Indian companies and in companies incorporated outside India which have significant operations or markets in India. While the principal focus is on investment in listed equity securities or equity-linked securities, the Company has the flexibility to invest in bonds (including non-investment grade bonds), convertibles and other types of securities. The Company may, for the purposes of hedging and investing, use derivative instruments such as financial futures, options and warrants. The Company may, from time to time, use borrowings to provide short-term liquidity and, if the Directors deem it prudent, for longer term purposes. The Directors intend to restrict borrowings on a longer-term basis to a maximum amount equal to 25% of the net assets of the Company at the time of the drawdown. It is the Company's current policy not to hedge the exposure to the Indian Rupee.
The portfolio concentration ranges between 30 and 40 stocks; however, to the extent the Company grows, the number of stocks held may increase over time. The Company is subject to the following investment limitations:
· No more than 10 per cent. of total assets of ICG Q and the Company (measured at the time of investment) may be invested in the securities of any one issuer; and
· No more than 10 per cent. of total assets of ICG Q and the Company (measured at the time of investment) may be invested in listed closed-ended funds.
The Board of Directors of the Company does not intend to use derivatives for investment purposes. The Directors confirm the investment policy of the Company has been complied with throughout the period from 1 January 2025 to 30 June 2025.
Investment Manager and AIF Manager
On 9 April 2025 the Board of the Company agreed to novate the Investment Management & AIFM Agreement entered into with Ocean Dial Asset Management Limited ("ODAM") on 19 September 2017 to SVM Asset Management Limited (trading as RGI Fund Management) ("SVM") with no change to its terms. SVM is a member of River Global PLC (previously AssetCo plc) ("River Global") which acquired ODAM on 2 October 2023 and this novation is the final part of the planned integration of ODAM into River Global's other active equity asset management businesses.
Results and dividends
The Company's performance during the period is discussed in the Investment Manager's review.
The results for the period are set out in the unaudited condensed statement of comprehensive income.
Consistent with the Company's investment policy of providing long term capital appreciation, the Directors do not recommend the payment of a dividend for the period ended 30 June 2025 (2024: £nil).
Substantial interests
Shareholders who held an interest of 3% or more of the Ordinary Share Capital of the Company at 29 August 2025, being the latest date such data is available, are stated in the table below:
|
|
|
|
|
No. of Shares |
|
% Holding |
|
Hargreaves Lansdown |
15,993,681 |
|
18.72% |
|||
|
Interactive Investor |
14,675,029 |
|
17.18% |
|||
|
AJ Bell |
5,097,472 |
|
5.97% |
|||
|
West Yorkshire Pension Fund |
4,677,028 |
|
5.48% |
|||
|
BNP arbitrage account |
4,039,301 |
|
4.73% |
|||
|
JM Finn |
4,010,552 |
|
4.70% |
|||
|
Charles Stanley |
2,635,138 |
|
3.09% |
|||
*Note - % Holding is the percentage of voting rights and issued share capital.
All substantial interests disclosed are held in nominee accounts, and in the opinion of the Directors, the Company has no ultimate controlling party.
Directors
Elisabeth Scott, Patrick Firth, Lynne Duquemin and Nick Timberlake served throughout the period and to date.
Share repurchases by the Company
Further to the shareholders' resolutions of 5 June 2025, 26 June 2024 and 27 June 2023, the Company purchased 395,000 ordinary shares in 2025 with a nominal value of £3,950, and representing 0.46% per cent of the Company's called up ordinary share capital, for a consideration of £670,375. Details of these purchases are provided in note 8 - Treasury Shares.
At the end of the year, the directors had authority, under the shareholders' resolutions of 5 June 2025, 26 June 2024 and 27 June 2023, to purchase through the market 14.99 per cent of the Company's ordinary shares. This authority expires on the date of the 2026 AGM.
Directors' interests
At 30 June 2025, Directors and their immediate families held the following declarable interests in the Company:
|
|
Ordinary shares |
Ordinary shares |
Ordinary shares |
|
|
30.06.25 |
30.06.24 |
31.12.24 |
|
|
|
|
|
|
Elisabeth Scott |
50,000 |
50,000 |
50,000 |
|
Patrick Firth |
25,000 |
25,000 |
25,000 |
|
Lynne Duquemin |
25,200 |
19,125 |
19,125 |
|
Nick Timberlake |
57,500 |
50,000 |
50,000 |
Ongoing charges
In accordance with the recommended methodology set out by the Association of Investment Companies ("AIC"), the ongoing charges ratio of the Company and its subsidiary for the period ended 30 June 2025 were 1.55% based on an average AUM of £155,035,702 (30 June 2024: 1.67% based on an average AUM of £159,359,953 and 31 December 2024: 1.58% based on an average AUM of £168,646,935).
Outlook
The investment philosophy of the Company is that in India optimal returns will be generated over time by investing in companies that are well placed to benefit from the structural growth potential of the Indian economy. Whilst uncertainties remain, the future outlook for the portfolio investee companies remains generally strong. This is reflected in the fact that the NAV of the Company has increased over the two months since the period end.
Sustainability and environmental, social and governance (ESG)
The ongoing development of internal ESG capabilities and reporting by the Manager continues and is supported by the Directors. The Company's statement on Sustainability and ESG is provided below, and the Company's report on Sustainability and ESG can be found in the 2024 Annual Report.
Principal Risks and Uncertainties
The Principal Risks and Uncertainties outlined in the Risk Management section of the Strategic Report of the 2024 Annual Report remain unchanged for the period to date with the exception of Emerging Risks.
The Board confirms that they have carried out a robust assessment of the principal risks facing the Company, including those that would threaten its business model, future performance, solvency or liquidity.
The Board has drawn up a Control Environment and Risk Assessment Matrix (the "Matrix"), which identifies the key risks to the Company and considers the impact and likelihood of each significant risk identified. The Board reviews the Matrix at least quarterly to ensure, in particular, that any emerging risks are identified, assessed and documented at an early stage.
The Principal Risks fall into several broad categories, which are set out below:
Investment performance and financial risk:
Significant market, foreign currency, credit and liquidity risks faced by the Company are set out in note 10 to the financial statements. The Company could be severely affected by a change in market conditions leading to a fall in share price and potentially a widening of the discount to NAV. These risks and their mitigation controls are reviewed at each quarterly Board meeting.
Redemption Facility and associated risk:
The third Redemption Facility where shareholders will be able to request the redemption of some or all of the shares will be 28 November 2025, following shareholder approval at the Company's AGM on 5 June 2025. There is therefore a possibility that redemptions requests may impair the future long-term viability of the Company. Based upon the investment performance of the Company to date, the diversity of the shareholder base and that shares have previously been issued from treasury at a premium to NAV to satisfy increased demand, the Board believes shareholder redemptions are likely to be at such a level not to impact the going concern of the Company.
Emerging risks:
Risks that emerge unexpectedly, and in some cases quite quickly, can have an economic impact upon the Company. In particular significant geopolitical conflicts such as the Russia/Ukraine conflict, Israel/Palestine conflict and the introduction of Trade Tariffs can disrupt global supply chains and the Indian economy and listed companies. The Board assesses and monitors these risks as and when they develop so, if necessary, controls and procedures can be implemented to mitigate against their economic impact upon the Company. During the period, there were no changes to the emerging risks identified, and no new procedures were implemented.
Cybersecurity, data security breach and related criminal activity risk:
The Company is exposed to the risk of criminal attacks on its data and systems held and managed by its service providers. Cybersecurity controls at all service providers are reviewed on a regular basis. Controls at the administrator are subject to an annual controls audit which is reviewed by the Audit & Risk Committee and any anomalies or breaches followed up.
Operations and systems risk:
The Company is exposed to the risks arising from any failure of systems and controls in the operations of the Investment Manager, the Administrator, or the Company's other service providers. Under normal circumstances members of the Audit & Risk Committee visit the Investment Manager annually to perform a due diligence review of its controls and the Board receives reports annually from the Administrator on their internal controls.
Environmental and Social ("E&S") impact risk:
The potential loss or harm directly or indirectly resulting from environmental and social factors that impact the Company, its investors and its service providers, and the consequential impact on the environment and society. E&S impact risk is a transverse risk that impacts our other risks: investment performance risk, currency and emerging market risk, operational non-financial risk, legal and regulatory risk and reputation risk. Our investment manager has developed a qualitative scoring model which measures climate and other environmental impacts and the reporting thereof by the Company's investment portfolio companies. The Investment Manager has an advisory team on the ground in India who keep abreast of the latest political developments and economic forecasts and regularly advise the Board thereof. The Board considers the reports from the Investment Manager and determines whether the Company is detrimentally affected.
Accounting, legal and regulatory risk:
The Company is at risk if it fails to comply with the laws and regulations applicable to a company with a premium listing on the Main Market of the London Stock Exchange and the Guernsey, Mauritian and Indian laws and regulations or if it fails to maintain accurate accounting records. The Investment Manager and Administrator are both regulated entities. The Board receives quarterly compliance reports which are reviewed and challenged where necessary. The Investment Manager and Administrator provide the Board with regular reports on changes in regulations and accounting requirements. Legal advice is taken where appropriate. Any breaches are addressed as soon as they are highlighted to the Board and appropriate action is taken to rectify.
Going concern
The Board made an assessment of the Company's ability to continue as a going concern for the twelve months from the date of approval of these unaudited condensed financial statements taking into account all available information about the future including the liquidity of the investment portfolio held both by the Company and its subsidiary, ICG Q Limited (83.1% of the portfolio can be liquidated within 5 days); the performance of the investment portfolio; the overall size of the Company and its impact on the Ongoing Charges of the Company (the NAV of the Company exceeded £100m throughout the year); the level of operating expenses covered by highly liquid investments held in the portfolio (operating expenses are more than 50 times covered by highly liquid investments); and the length of time to remit funds from India to Mauritius and Guernsey to settle ongoing expenses (no more than 10 working days to have investments liquidated and sterling funds in Guernsey).
Given the Company's previous performance, the Directors proposed a continuation ordinary resolution at the Extraordinary General Meeting held on 12 June 2020, at which the Shareholders approved that the Company continue as currently constituted and introduce a Redemption Facility which gives the ordinary shareholders the ability to redeem part or all of their shareholding at a Redemption Point every two years. The first Redemption Point was on 31 December 2021 when valid redemption requests were received in respect of ordinary shares which were subsequently redeemed under the Redemption Facility in accordance with the announced timetable.
The second Redemption Point was on 31 December 2023 when valid redemption requests were received in respect of 15,159,876 ordinary shares (15.7% of the then issued share capital) which were subsequently redeemed under the Redemption Facility at a total cost of £26.2m in accordance with the announced redemption price on 8 January 2024. During 2024, to satisfy demand in the market, the Company issued over 5.8m shares from Treasury at a premium to NAV raising over £10.5m in new capital, and bought back 1.6,m shares at a significant discount to NAV. In 2025 to date, further buybacks were made subsequent to the year end, details of which can be found in Note 8 to the Financial Statements. As at 29 August 2025 the Company's NAV was £154.4m.
The next date at which shareholders will be able to request the redemption of some or all of the shares will take place on 28 November 2025. for shareholders on the register at 29 August 2025. This was approved by shareholders at the Company's AGM on 5 June 2025. Based upon the performance of the Company to date, the results of the previous two redemptions, and the increase of the proportion of retail shareholders seeking long term value growth on the share register since the last Redemption Facility on 31 December 2023, the Board believes shareholder redemptions at the forthcoming Redemption Facility on 29 November 2025 are likely to be at such a level not to impact the going concern of the Company.
The Directors are satisfied that the Company has sufficient liquid resources to continue in business for the next twelve months, therefore the unaudited condensed financial statements have been prepared on a going concern basis.
Approved by the Board of Directors and signed on behalf of the Board on 24 September 2025.
Lynne Duquemin Patrick Firth
STATEMENT OF DIRECTORS' RESPONSIBILITY IN RESPECT OF THE HALF-YEARLY FINANCIAL REPORT
We confirm that to the best of our knowledge:
a) the condensed set of financial statements has been prepared in accordance with UK-adopted IAS 34 'Interim Financial Reporting';
b) the interim director's report includes a fair review of the information required by DTR 4.2.7R (indication of important events and their impact during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and
c) the interim Director's report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).
Signed on behalf of the Board by:
Lynne Duquemin Patrick Firth
UNAUDITED CONDENSED STATEMENT OF COMPREHENSIVE INCOME
For the six months to 30 June 2025
|
|
|
|
|
Unaudited |
Unaudited |
Audited |
|
|
|
|
|
Six months |
Six months |
Year to |
|
|
|
|
|
to 30.06.25 |
to 30.06.24 |
31.12.24 |
|
|
Notes |
Revenue £000 |
Capital £000 |
Total |
Total |
Total |
|
|
||||||
|
|
|
|
|
|
|
|
|
Income |
|
|
|
|
|
|
|
Dividend income |
|
146 |
- |
146 |
202 |
471 |
|
Foreign exchange loss |
|
(371) |
- |
(371) |
(196) |
(531) |
|
Net (loss)/gain on financial assets at fair value through profit or loss ("FVTPL") |
5 |
- |
(16,183) |
(16,183) |
16,261 |
26,400 |
|
Management fees from subsidiary |
11 |
555 |
- |
555 |
761 |
1,464 |
|
Total income |
|
330 |
(16,183) |
(15,853) |
17,028 |
27,804 |
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
Management fees |
11 |
(887) |
- |
(887) |
(925) |
(1,944) |
|
Operating expenses |
3 |
(280) |
- |
(280) |
(392) |
(706) |
|
Transaction costs |
|
(21) |
- |
(21) |
(56) |
(84) |
|
Total expenses |
|
(1,188) |
- |
(1,188) |
(1,373) |
(2,734) |
|
|
|
|
|
|
|
|
|
(Loss)/profit for the period/year before taxation |
|
(858) |
(16,183) |
(17,041) |
15,655 |
25,070 |
|
|
|
|
|
|
|
|
|
Taxation |
6 |
(25) |
311 |
286 |
(502) |
(1,630) |
|
Total comprehensive (loss)/income for the period/year after taxation |
|
(883) |
(15,872) |
(16,755) |
15,153 |
23,440 |
|
|
|
|
|
|
|
|
|
Earnings per Ordinary Share (pence) |
4 |
|
|
(19.60) |
17.40 |
27.04 |
|
Diluted earnings per Ordinary Share (pence) |
4 |
|
|
(19.60) |
17.40 |
27.04 |
The total column of this statement represents the Company's statement of comprehensive income, prepared in accordance with IFRS Accounting Standards as adopted by the UK. The supplementary revenue and capital columns are both prepared under guidance published by the Association of Investment Companies, as disclosed in the Basis of Preparation in note 1.
The profit after tax is the "total comprehensive income" as defined by IAS 1. There is no other comprehensive income as defined by IFRS Accounting Standards and all the items in the above statement derive from continuing operations.
UNAUDITED CONDENSED STATEMENT OF FINANCIAL POSITION
As at 30 June 2025
|
|
|
|
Unaudited |
|
Unaudited |
|
Audited |
|
|
|
|
30.06.25 |
|
30.06.24 |
|
31.12.24 |
|
|
Notes |
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
Non-current asset |
|
|
|
|
|
|
|
|
Financial asset designated at fair value through profit or loss ("FVTPL") |
5 |
|
157,229 |
|
169,216 |
|
171,300 |
|
|
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
12 |
|
6,860 |
|
4,877 |
|
9,507 |
|
Other receivables and prepayments |
|
|
311 |
|
623 |
|
1,337 |
|
|
|
|
7,171 |
|
5,500 |
|
10,844 |
|
|
|
|
|
|
|
|
|
|
Current liability |
|
|
|
|
|
|
|
|
Payables and accruals |
|
|
(269) |
|
(236) |
|
(277) |
|
|
|
|
|
|
|
|
|
|
Net current assets |
|
|
6,902 |
|
5,264 |
|
10,567 |
|
|
|
|
|
|
|
|
|
|
Non-current liability |
|
|
|
|
|
|
|
|
Deferred taxation |
6 |
|
(2,199) |
|
(1,552) |
|
(2,510) |
|
|
|
|
|
|
|
|
|
|
Net assets |
|
|
161,932 |
|
172,928 |
|
179,357 |
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
|
Share capital |
8 |
|
854 |
|
868 |
|
858 |
|
Reserves |
|
|
161,078 |
|
172,060 |
|
178,499 |
|
|
|
|
|
|
|
|
|
|
Total equity |
|
|
161,932 |
|
172,928 |
|
179,357 |
|
|
|
|
|
|
|
|
|
|
Number of Ordinary Shares in issue |
8 |
|
85,415,644 |
|
86,811,872 |
|
85,810,644 |
|
|
|
|
|
|
|
|
|
|
NAV per Ordinary Share (pence) - Undiluted and diluted |
|
189.58 |
|
199.20 |
|
209.01 |
|
|
|
|
|
|
|
|
|
|
The unaudited condensed financial statements were approved and authorised for issue by the Board of Directors on 24 September 2025 and signed on its behalf by:-
Lynne Duquemin Patrick Firth
UNAUDITED CONDENSED STATEMENT OF CHANGES IN EQUITY
For the six months to 30 June 2025
|
|
Notes |
Share Capital £000 |
Capital Reserve £000 |
Revenue Reserve £000 |
Other Distributable Reserve £000 |
Total £000 |
|
|
|
|
|
|
|
|
|
|
|
Balance as at 1 January 2025 |
|
858 |
135,919 |
(10,524) |
53,104 |
179,357 |
|
|
|
|
|
|
|
|
|
|
|
Loss on investments |
|
5 |
- |
(15,872) |
- |
- |
(15,873) |
|
|
|
|
|
|
|
|
|
|
Share repurchase |
|
8 |
(4) |
- |
- |
(666) |
(670) |
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the period |
|
- |
- |
- |
(883) |
(882) |
|
|
|
|
|
|
|
|
|
|
|
Balance as at 30 June 2025 |
|
854 |
120,047 |
(10,524) |
51,555 |
161,932 |
|
For the six months to 30 June 2024
|
|
Notes |
Share Capital £000 |
Capital Reserve £000 |
Revenue Reserve £000 |
Other Distributable Reserve £000 |
Total £000 |
|
|
|
|
|
|
|
|
|
|
|
Balance as at 1 January 2024 |
|
963 |
111,056 |
(10,524) |
72,007 |
173,502 |
|
|
|
|
|
|
|
|
|
|
|
Gain on investments |
|
5 |
- |
15,802 |
- |
- |
15,802 |
|
|
|
|
|
|
|
|
|
|
Share issue |
|
8 |
63 |
- |
- |
11,390 |
11,453 |
|
|
|
|
|
|
|
|
|
|
Share repurchase |
|
8 |
(158) |
- |
- |
(27,022) |
(27,180) |
|
|
|
|
|
|
|
|
|
|
Total comprehensive loss for the period |
|
- |
- |
- |
(649) |
(649) |
|
|
|
|
|
|
|
|
|
|
|
Balance as at 30 June 2024 |
|
868 |
126,858 |
(10,524) |
55,726 |
172,928 |
|
For the year ended 31 December 2024
|
|
Notes |
Share Capital £000 |
Capital Reserve £000 |
Revenue Reserve £000 |
Other Distributable Reserve £000 |
Total £000 |
|||||
|
|
|
|
|
|
|
|
|
||||
|
Balance as at 1 January 2024 |
|
|
963 |
111,056 |
(10,524) |
72,007 |
173,502 |
||||
|
|
|
|
|
|
|
|
|
||||
|
Gain on investments |
|
5 |
- |
24,863 |
- |
- |
24,863 |
||||
|
|
|
|
|
|
|
|
|
||||
|
Share issue |
|
8 |
63 |
- |
- |
11,390 |
11,453 |
||||
|
|
|
|
|
|
|
|
|
||||
|
Share repurchase |
|
8 |
(168) |
- |
- |
(28,870) |
(29,038) |
||||
|
|
|
|
|
|
|
|
|
||||
|
Total comprehensive loss for the year |
|
- |
- |
- |
(1,423) |
(1,423) |
|||||
|
|
|
|
|
|
|
|
|||||
|
Balance as at 31 December 2024 |
|
|
858 |
135,919 |
(10,524) |
53,104 |
179,357 |
||||
UNAUDITED CONDENSED STATEMENT OF CASH FLOWS
For the six months to 30 June 2025
|
|
|
|
Unaudited |
|
Unaudited |
|
Audited |
|
|
|
|
30.06.25 |
|
30.06.24 |
|
31.12.24 |
|
|
Note |
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Operating (loss)/profit |
|
|
(17,041) |
|
15,655 |
|
25,070 |
|
|
|
|
|
|
|
|
|
|
Adjustments for: |
|
|
|
|
|
|
|
|
Net loss/(gain) on financial asset at FVTPL |
|
|
16,183 |
|
(16,261) |
|
(26,400) |
|
Foreign exchange loss |
|
|
371 |
|
196 |
|
531 |
|
Dividend income |
|
|
(146) |
|
(202) |
|
(471) |
|
Decrease/(increase) in other receivables and prepayments |
1,026 |
|
(432) |
|
(1,146) |
||
|
(Decrease)/increase in payables and accruals |
|
|
(8) |
|
(18) |
|
23 |
|
Cash generated from/(used) in operations |
|
|
385 |
|
(1,062) |
|
(2,393) |
|
Taxes paid |
|
|
(25) |
|
(43) |
|
(213) |
|
Net cash flows generated from/(used in) operating activities |
|
|
360 |
|
(1,105) |
|
(2,606) |
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
Dividend income |
|
|
146 |
|
202 |
|
471 |
|
Acquisition of investments |
5 |
(9,455) |
|
(34,544) |
|
(30,381) |
|
|
Disposal of investments |
5 |
7,343 |
|
51,238 |
|
55,130 |
|
|
Net cash flows (used in)/generated from investing activities |
|
|
(1,966) |
|
16,896 |
|
25,220 |
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
Issue of shares |
|
|
- |
|
11,453 |
|
11,453 |
|
Redemption of shares |
|
|
(670) |
|
(27,180) |
|
(29,038) |
|
Net cash flows used in financing activities |
|
|
(670) |
|
(15,727) |
|
(17,585) |
|
|
|
|
|
|
|
|
|
|
Net (decrease)/increase in cash and cash equivalents during the period/year |
|
|
(2,276) |
|
64 |
|
5,029 |
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at the start of the period/year |
|
|
9,507 |
|
5,009 |
|
5,009 |
|
|
|
|
|
|
|
|
|
|
Foreign exchange loss |
|
|
(371) |
|
(196) |
|
(531) |
|
Cash and cash equivalents at the end of the period/year |
|
|
6,860 |
|
4,877 |
|
9,507 |
NOTES TO THE UNAUDITED CONDENSED FINANCIAL STATEMENTS
For the six months to 30 June 2025
1. Material accounting policies
Basis of accounting
The unaudited condensed financial statements have been prepared in accordance with IFRS Accounting Standards as adopted by the UK, IAS 34 'Interim Financial Reporting' and, except as described below, the material accounting policies set out in the statutory accounts of the Company for the year ended 31 December 2024.
Basis of preparation
The unaudited condensed financial statements do not include all of the information required for a complete set of IFRS Accounting Standards financial statements and should be read in conjunction with the consolidated financial statements of the Company for the year ended 31 December 2024, which were prepared under full IFRS Accounting Standards requirements.
Changes in material accounting policies
New and revised standards
The following standards and interpretations effective for the first time for the financial period beginning on or after 1 January 2025:
· Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability
The above amendments are not expected to have a material impact on the Company's unaudited condensed financial statements.
Standards and interpretations published, but not yet effective for the annual period beginning on 1 January 2025:
· Amendments to IFRS 9 and IFRS 7: Classification and Measurements of Financial instruments (applicable for annual periods beginning on or after 1 January 2026)
· Amendments to IFRS 18: Presentation and Disclosure in Financial Statements (applicable for annual periods beginning on or after 1 January 2027)
The above amendments are not expected to have a material impact on the Company's financial statements.
Going concern
The Board made an assessment of the Company's ability to continue as a going concern for the twelve months from the date of approval of these unaudited condensed financial statements taking into account all available information about the future including the liquidity of the investment portfolio held both by the Company and its subsidiary, ICG Q Limited (83.1% of the portfolio can be liquidated within 5 days); the performance of the investment portfolio; the overall size of the Company and its impact on the Ongoing Charges of the Company (the NAV of the Company exceeded £100m throughout the year); the level of operating expenses covered by highly liquid investments held in the portfolio (operating expenses are more than 50 times covered by highly liquid investments); and the length of time to remit funds from India to Mauritius and Guernsey to settle ongoing expenses (no more than 10 working days to have investments liquidated and sterling funds in Guernsey).
Given the Company's previous performance, the Directors proposed a continuation ordinary resolution at the Extraordinary General Meeting held on 12 June 2020, at which the Shareholders approved that the Company continue as currently constituted and introduce a Redemption Facility which gives the ordinary shareholders the ability to redeem part or all of their shareholding at a Redemption Point every two years. The first Redemption Point was on 31 December 2021 when valid redemption requests were received in respect of ordinary shares which were subsequently redeemed under the Redemption Facility in accordance with the announced timetable.
The second Redemption Point was on 31 December 2023 when valid redemption requests were received in respect of 15,159,876 ordinary shares (15.7% of the then issued share capital) which were subsequently redeemed under the Redemption Facility at a total cost of £26.2m in accordance with the announced redemption price on 8 January 2024. During 2024, to satisfy demand in the market, the Company issued over 5.8m shares from Treasury at a premium to NAV raising over £10.5m in new capital, and bought back 1.6,m shares at a significant discount to NAV. In 2025 to date, further buybacks were made subsequent to the year end, details of which can be found in Note 8 to the Financial Statements. As at 29 August 2025 the Company's NAV was £154.4m.
The next date on which shareholders will be able to request the redemption of some or all of the shares will be on 28 November 2025 for shareholders on the register at 29 August 2025. This was approved by shareholders at the Company's AGM on 5 June 2025. Based upon the performance of the Company to date, the results of the previous two redemptions, and the increase of the proportion of retail shareholders seeking long term value growth on the share register since the last Redemption Facility on 31 December 2023, the Board believes shareholder redemptions at the forthcoming Redemption Facility on 28 November 2025 are likely to be at such a level not to impact the going concern of the Company.
The Directors are satisfied that the Company has sufficient liquid resources to continue in business for the next twelve months, therefore the unaudited condensed financial statements have been prepared on a going concern basis.
Determination of functional currency
'Functional currency' is the currency of the primary economic environment in which the Company operates. If indicators of the primary economic environment are mixed, then management uses its judgement to determine the functional currency that most faithfully represents the economic effect of the underlying transactions, events and conditions.
The Company's investments and transactions are denominated in United States Dollar and Indian Rupee. The primary objective of the Company is to generate returns and capital growth in Great British Pounds ("GBP") for the benefit of its shareholder. The assets and liabilities of the Company and the cash flows are predominantly GBP denominated. The Company's performance is also evaluated in GBP. The determination of the Company's functional currency is determined based on management's significant judgement in assessing the economic environment in which the Company operates.
Accordingly, management has to exercise significant judgement in determining the functional currency resulting from the use of different foreign currencies in the Company's operations.
Investment management fees
Investment management fees are receivable from ICG Q and payable to Ocean Dial Asset Management Limited. In previous reporting periods, both the investment management fee payable and the investment management fee receivable have been the same, and as such, had a net nil effect on the Statement of Comprehensive Income. From January 2024, the method of calculation for these fees has been updated. Investment management fees receivable from ICG Q are calculated based on the NAV of ICG Q. Investment management fees payable to Ocean Dial Asset Management Limited are based on the assets of ICGF. The overall burden of investment management fees to ICGF remains unchanged at 1.25% of the lower of the company's market capitalisation or net asset value calculated on a daily basis and payable monthly. Investment management fees received in the period ended 30 June 2025 totalled £555k (31 December 2024: £1,702k, 30 June 2024: £761k). Investment management fees paid in the period ended 30 June 2025 totalled £887k (31 December 2024: £1,944k, 30 June 2024: £925k).
2. Critical accounting judgements and key sources of estimation uncertainty
Directors make judgements, estimates and assumptions that affect the application of policies and the reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about the carrying value of assets and liabilities that are not readily apparent from other sources. The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equate to the related actual results.
Critical accounting judgements
IFRS 10 defines an investment entity and requires a reporting entity that meets the definition of an investment entity not to consolidate its subsidiaries, but instead to measure its subsidiaries at FVTPL in its financial statements.
An investment entity is defined as an entity that:
· Obtains funds from one or more investors for the purpose of providing them with professional investment management services.
· Commits to its investor(s) that its business purpose is to invest funds solely for returns from capital appreciation, investment income, or both.
· Measures and evaluates performance of substantially all of its investments on a fair value basis.
The Board has concluded that the Company is an investment entity as it satisfies more than one of the typical characteristics of an investment entity as noted above.
Key sources of estimation uncertainty
The Company invests in listed shares for which no estimation is required to determine the closing values. The underlying investments in ICG Q are all listed securities. All other components of ICG Q's NAV pertain to instruments which do not require estimation. Details of the valuation methodologies and assumptions applied in determining the fair value of the Company's investments and sensitivities to those assumptions,
are disclosed in note 9.
3. Operating expenses
|
|
|
|
Unaudited Six months |
|
Unaudited Six months |
|
Audited |
|
|
|
|
to 30.06.25 |
|
to 30.06.24 |
|
to 31.12.24 |
|
|
|
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
Administration and secretarial fees |
45 |
|
46 |
|
96 |
||
|
Audit fee |
|
|
31 |
|
36 |
|
69 |
|
Broker fee |
|
|
17 |
|
15 |
|
43 |
|
D&O insurance |
|
|
8 |
|
4 |
|
8 |
|
Directors' fees and expenses |
|
|
68 |
|
74 |
|
144 |
|
General expenses |
27 |
|
18 |
|
54 |
||
|
Marketing expenses |
37 |
|
48 |
|
81 |
||
|
Other professional fees |
30 |
|
123 |
|
132 |
||
|
Registrar fee |
4 |
|
13 |
|
16 |
||
|
Regulatory fees |
|
|
13 |
|
15 |
|
40 |
|
Other expenses |
|
|
- |
|
- |
|
23 |
|
|
|
|
280 |
|
392 |
|
706 |
4. Earnings per share
Earnings per Ordinary Share and the fully diluted earnings per Ordinary Share are calculated on the loss for the period of £16,755,000 (30 June 2024 - profit of £15,152,985) divided by the weighted average number of Ordinary Shares of 85,489,346 (30 June 2024 - 87,086,286) which is £(19.60) (30 June 2024: £17.40).
5. Financial assets at fair value through profit or loss ("FVTPL")
Financial assets at FVTPL consists of investments in securities listed on Indian Stock Exchanges, namely the National Stock Exchange or the Bombay Stock Exchange, as well as investment in the wholly owned subsidiary, ICG Q Limited. A summary of movements is shown below:
|
|
|
|
|
Unaudited |
|
Unaudited |
|
Audited |
|
|
|
|
Six months |
|
Six months |
|
Year to |
|
|
|
|
|
to 30.06.25 |
|
to 30.06.24 |
|
31.12.24 |
|
|
|
|
|
Total |
|
Total |
|
Total |
|
|
|
|
|
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
|
Fair value at beginning of period/year |
|
|
|
171,300 |
|
169,649 |
|
169,649 |
|
Disposal of investments |
|
|
|
(7,343) |
|
(51,238) |
|
(55,130) |
|
Acquisition of investments |
|
|
|
9,455 |
|
34,544 |
|
30,381 |
|
Realised gain on disposal of investments |
|
3,457 |
|
27,598 |
|
41,306 |
||
|
Unrealised loss on revaluation |
|
|
(19,640) |
|
(11,337) |
|
(14,906) |
|
|
Fair value at end of period/year |
|
|
|
157,229 |
|
169,216 |
|
171,300 |
The net realised and unrealised loss above totalling £16,183,000 (30 June 2024: £16,261,000) on financial assets at FVTPL comprise the loss on the Company's holding in ICG Q Limited to the extent of £9,636,000 (30 June 2024: gain of £12,096,000) and loss of £6,547,000 (30 June 2024: gain of £4,165,000) arising from investments in securities listed on Indian stock markets. The movement arising from the Company's holding in ICG Q Limited is driven by the following amounts within the financial statements of ICG Q Limited, as set out below.
|
|
Unaudited |
|
Unaudited |
|
Audited |
|
|
Six months |
|
Six months |
|
Year to |
|
|
to 30.06.25 |
|
to 30.06.24 |
|
31.12.24 |
|
|
Total |
|
Total |
|
Total |
|
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
Dividend income |
179 |
|
247 |
|
599 |
|
Unrealised loss on financial assets at FVTPL |
(14,868) |
|
(3,524) |
|
(3,923) |
|
Foreign exchange (loss)/gain |
(1,500) |
|
1,025 |
|
285 |
|
Realised gain on disposal of investments |
6,360 |
|
16,118 |
|
28,188 |
|
Investment management fees |
(555) |
|
(761) |
|
(1,464) |
|
Other operating expenses |
(53) |
|
(49) |
|
(98) |
|
Withholding tax on dividend income |
(37) |
|
(52) |
|
(125) |
|
Deferred taxation for Indian CGT |
1,326 |
|
675 |
|
(1,026) |
|
Taxation |
(461) |
|
(1,594) |
|
(3,465) |
|
Transaction costs |
(27) |
|
(64) |
|
(104) |
|
Other income |
- |
|
75 |
|
- |
|
Net (loss)/profit of ICG Q Limited |
(9,636) |
|
12,096 |
|
19,017 |
The equity investment represents ICG Q Limited, the Company's wholly owned subsidiary. ICG Q Limited is incorporated and has its principal place of business in the Republic of Mauritius. The Company holds Participating Shares in ICG Q Limited, which confer voting rights to the Company, hence controlling interests.
6. Taxation
Guernsey
India Capital Growth Fund Limited is exempt from taxation in Guernsey on non-Guernsey sourced income. The Company is exempt under The Income Tax (Exempt Bodies) (Guernsey) Ordinance 1989 (as amended) and paid the annual exemption fee of £1,200. For the period ended 30 June 2025, the Company had a tax liability of £Nil (2024: £Nil).
India
Capital gains arising from equity investments in Indian companies are subject to Indian Capital Gains Tax Regulations. Consequently, with effect from July 2024, the Company and its subsidiary, ICG Q Limited, have been subject to both short and long-term capital gains tax in India on the growth in value of their investment portfolios at the rate of 20% and 12.5% respectively. Although this additional tax only becomes payable at the point at which the underlying investments are sold and profits crystallised, the Company and its subsidiary must accrue for this additional cost as a deferred taxation liability, notwithstanding that they seek to minimise the impact of these taxation rates applicable to capital gains by maintaining its investment strategy of investing in a concentrated portfolio for long-term capital appreciation. An amount of £120,000 was paid during 2024. The Indian Capital Gains Tax deferred tax liability is determined at each month end by the Company's India Tax Agent based upon the period each investment has been held and the Indian Capital Gains Tax Regulations in force at the time of that assessment. The deferred taxation liability relating to Indian capital gains tax for the Company was £2,199,000 at 30 June 2025 (30 June 2024: £1,552,000) (31 December 2024: £2,510,000) and for its subsidiary was £7,533,000 at 30 June 2025 (30 June 2024: £7,153,000) (31 December 2024: £8,859,000).
Dividend withholding tax
The Company and its subsidiary are also subject to withholding tax on their dividend income in India. The withholding tax charge for the Company for the period ended 30 June 2025 was £24,000 (30 June 2024: £43,000) and for its subsidiary was £37,000 (30 June 2024: £52,000).
Minimum top-up tax
The Company has adopted mandatory exception to the International Tax Reform - Pillar Two Model Rules (Amendments to IAS 12) upon their release on 23 May 2023. The amendments provide a temporary mandatory exception from deferred tax accounting for the top-up tax, which is effective immediately, and require new disclosures about the Pillar Two exposure. However, because no new legislation to implement the top-up tax was enacted or substantively enacted in India hence no related deferred tax was recognised at that date, the retrospective application has no impact on the Company's financial statements. The adoption of Pillar Two by Guernsey effective 1 January 2025 does not have an impact on the Company.
7. Segmental information
The Board has considered the provisions of IFRS 8 in relation to segmental reporting and concluded that the Company's activities are from a single segment under the standard. From a geographical perspective, the Company's activities are focused in a single area - India. The subsidiary, ICG Q Limited, focuses its investment activities in listed securities in India. Additional disclosures have been provided in the 2024 Annual Report as elaborated in the Directors' Report therein.
8. Share capital
Authorised Share Capital
Unlimited number of Ordinary Shares of £0.01 each
|
Issued share capital |
|
Number of shares |
|
Share capital |
|||||
|
|
|
|
|
|
|
|
|
£000 |
|
|
|
|
|
|
|
|
||||
|
At 30 June 2025 |
|
|
|
|
|
|
85,415,644 |
|
854 |
|
At 30 June 2024 |
|
|
|
|
|
|
86,811,872 |
|
868 |
|
At 31 December 2024 |
|
|
|
|
|
|
85,810,644 |
|
858 |
The Ordinary Shares of the Company carry the following rights:
(i) The holders of Ordinary Shares have the right to receive in proportion to their holdings all the revenue profits of the Company (including accumulated revenue reserves) attributable to the Ordinary Shares as a class available for distribution and determined to be distributed by way of interim and/or final dividend at such times as the Directors may determine.
(ii) On a winding-up of the Company, after paying all the debts attributable to and satisfying all the liabilities of the Company, holders of the Ordinary Shares shall be entitled to receive by way of capital any surplus assets of the Company attributable to the Ordinary Shares as a class in proportion to their holdings.
(iii) Subject to any special rights or restrictions for the time being attached to any class of shares, on a show of hands every member present in person has one vote. Upon a poll every member present in person or by proxy has one vote for each share held by him.
Treasury Shares
There was a total buy back of 395,000 ordinary shares during the period ended 30 June 2025. These shares were transferred from Issued Share Capital Account to Treasury Shares Account and were purchased at a discount to the Net Asset Value per share, as per below:
|
Date |
Number of shares |
Par Value (£) |
Discount on day of Buy back |
Buy Back Price (£) |
Value of Buy back (£) |
|
|
|
|
|
|
|
|
20 January 2025 |
15,000 |
2.05 |
10.7% |
1.83 |
27,450 |
|
21 January 2025 |
150,000 |
1.99 |
11.0% |
1.77 |
265,000 |
|
22 January 2025 |
50,000 |
1.94 |
11.1% |
1.73 |
86,250 |
|
06 February 2025 |
25,000 |
1.93 |
11.0% |
1.72 |
43,000 |
|
12 February 2025 |
55,000 |
1.87 |
9.7% |
1.69 |
92,675 |
|
14 February 2025 |
50,000 |
1.79 |
10.6% |
1.60 |
80,000 |
|
04 March 2025 |
50,000 |
1.68 |
10.0% |
1.51 |
75,000 |
|
|
395,000 |
|
|
|
670,375 |
Other distributable reserves
Other distributable reserves includes all other gains and losses during the year except for the realised and unrealised gains and losses on the investments measured at FVTPL. Other distributable reserves also includes foreign exchange gains and losses made on ordinary transactions, dividend income and general expenses, as well as taxation.
9. Fair value of financial instruments
The following tables show financial instruments recognised at fair value, analysed between those whose fair value is based on:
· Quoted prices in active markets for identical assets or liabilities (Level 1);
· Those involving inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices) (Level 2); and
· Those with inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3).
The analysis as at 30 June 2025 is as follows:
|
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
Total |
|
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
Listed securities |
66,189 |
|
- |
|
- |
|
66,189 |
|
Unlisted securities |
- |
|
91,040 |
|
- |
|
91,040 |
|
|
66,189 |
|
91,040 |
|
- |
|
157,229 |
The analysis as at 30 June 2024 is as follows:
|
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
Total |
|
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
Listed securities |
56,076 |
|
- |
|
- |
|
56,076 |
|
Unlisted securities |
- |
|
113,140 |
|
- |
|
113,140 |
|
|
56,076 |
|
113,140 |
|
- |
|
169,216 |
The analysis as at 31 December 2024 is as follows:
|
|
Level 1 |
|
Level 2 |
|
Level 3 |
|
Total |
|
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
Listed securities |
65,924 |
|
- |
|
- |
|
65,924 |
|
Unlisted securities |
- |
|
105,376 |
|
- |
|
105,376 |
|
|
65,924 |
|
105,376 |
|
- |
|
171,300 |
The Company's investment in ICG Q Limited, the Company's wholly owned subsidiary is priced based on the subsidiary's NAV as calculated as at the reporting date. The Company has the ability to redeem its investment in ICG Q Limited at the NAV at the measurement date therefore this is categorised as level 2. The classification within the hierarchy does not necessarily correspond to the Investment Manager's perceived risk of the investment, nor the level of the investments held within the subsidiary. All the underlying investments of ICG Q Limited are categorised as level 1 at 30 June 2025 and 2024. The period-end fair value of those investments, together with cash held in ICG Q Limited, comprise all but an insignificant proportion of the NAV of the subsidiary.
There has been no movement between levels for the period ended 30 June 2025. There were no changes in valuation techniques during the period ended 30 June 2025.
10. Financial instruments and risk profile
The primary objective of the Company is to provide long-term capital appreciation by investing predominantly in companies based in India. The investment policy permits making investments in a range of equity and equity linked securities of such companies. The portfolio of investments comprises of listed Indian companies, predominantly mid cap and small cap. The specific risks arising from exposure to these instruments and the Investment Manager's policies for managing these risks, which have been applied throughout the period, are summarised below:
Capital management
The Company is a closed-ended investment company and thus has fixed capital for investment. It has no legal capital regulatory requirement. The Board has the power to purchase shares for cancellation thus reducing capital and the Board considers on a regular basis whether it is appropriate to exercise such powers. In the period ended 30 June 2025, the Board determined that it was inappropriate to exercise such powers, although continuation of these powers will be sought at the Annual General Meeting.
The Board also considers from time to time whether it may be appropriate to raise new capital by a further issue of shares. The raising of new capital would, however, be dependent on there being genuine market demand (see note 8).
Environmental and social ("E&S") impact risk
E&S impact risk is a transverse risk that impacts most of our other risks: market risk, foreign currency risk, credit risk, liquidity risk, operational non-financial risk, legal and regulatory risk, and reputation risk. Our Investment Manager has developed a qualitative scoring model which measures climate and other environmental impacts and the reporting thereof by the Company's investment portfolio companies.
The Investment Manager considers all factors that may have a financial material impact on returns. Climate change is a key factor. The related physical and transition risks are vast and are becoming increasingly financially material for many investments. Not only in the obvious high-emitting sectors, such as energy, utilities and transportation, but also along the supply chain, providers of finance and in those reliant on agricultural outputs and water. It is important that the financial implications of material climate-change risks are assessed across all asset classes, including real assets, and make portfolios more resilient to climate risk. Comparable climate-related data is necessary to enable effective decision making and is something the Investment Manager actively sources and incorporates into its process and scoring model. Regular engagement with all investee companies allows the Investment Manager to better understand their exposure and management of climate change risks and influence corporate behaviour positively in relation to climate risk management. There have been no financial material impacts as a result of E&S risk.
Market risk
Market price risk arises mainly from the uncertainty about future prices of the financial instruments held by the Company and its subsidiary, ICG Q Limited ("the Group"). It represents the potential loss the Group may suffer through holding market positions in the face of price movements.
The Group's investment portfolio is exposed to market price fluctuations, including the impact of inflation, which are monitored by the Investment Manager in pursuit of the investment objectives and policies and in adherence to the investment guidelines and the investment and borrowing powers set out in the Admission Document. The Group's investment portfolio is concentrated and, as at 30 June 2025, comprised investment in 37 (30 June 2024: 35) companies. Thus, the Group has higher exposure to market risk in relation to individual stocks than more broadly spread portfolios.
The Investment Manager has a team on the ground in India who keep abreast of the latest political developments and economic forecasts that may impact the listed equities market in India and regularly advise the Board thereof.
The Group's investment portfolio (refer to pages 11 to 13) consists predominantly of mid cap and small cap listed Indian securities, and thus the effect of market movements is not closely correlated with the principal market index, the BSE Sensex. The BSE Mid Cap Total Return Index provides a better (but not ideal) indicator of the effect of market price risk on the portfolio. Assuming perfect correlation, the sensitivity of the Group's investment portfolio to market price risk can be approximated by applying the percentage of funds invested (31 December 2024: 94.8%; 30 June 2024: 96.5%) to any movement in the BSE Mid Cap Total Return Index.
At 30 June 2025, with all other variables held constant, this approximation would produce a movement in the net assets of the Group's investment portfolio of £16,197,565 (30 June 2024: £17,523,492) for a 10% (2024: 10%) movement in the index which would impact the Company via a fair value movement of the same magnitude in its holding in ICG Q Limited and its investments.
Foreign currency risk
Foreign currency risk arises mainly from the fair value or future cash flows of the financial instruments held by the Group fluctuating because of changes in foreign exchange rates. The Group's investment portfolio consists of predominantly Rupee denominated investments but reporting, and in particular the reported NAV, is denominated in Sterling. Any appreciation or depreciation in the Rupee would have an impact on the performance of the Company. The underlying currency risk in relation to the Group's investment portfolio is the Rupee. The Group's policy is not to hedge the Rupee exposure. The Group may enter into currency hedging transactions but appropriate mechanisms on acceptable terms are not expected to be readily available.
At 30 June 2025, if the Indian Rupee had strengthened or weakened by 10% (30 June 2024: 10%) against Sterling with all other variables held constant, pre-tax profit for the period would have been £15,207,935 (30 June 2024: £18,897,800) higher or lower, respectively, mainly as a result of foreign exchange gains or losses on translation of Indian Rupee denominated financial assets designated at FVTPL in ICG Q Limited, the consequent impact on the fair value of the Company's investment in ICG Q Limited and in the Company's investment portfolio.
Credit risk
Credit risk arises mainly from an issuer or counterparty being unable to meet a commitment that it has entered into with the Company. Credit risk in relation to securities transactions awaiting settlement is managed through the rules and procedures of the relevant stock exchanges. In particular settlements for transactions in listed securities are effected by the custodian on a delivery against payment or receipt against payment basis. Transactions in unlisted securities are effected against binding subscription agreements.
The principal credit risks are in relation to cash held by the custodian. Kotak Mahindra Bank Limited ("Kotak") acts as the custodian to the Company. The aggregate exposure to Kotak at 30 June 2025 was £3,292,333 (30 June 2024: £4,058,943) (31 December 2024: £3,127,763).
Kotak acted as custodian of the Company's assets during the period. The securities held by Kotak as custodian are held in trust and are registered in the name of the Company. Kotak has a long-term credit rating of AAA (2024: AAA) (CRISIL Ratings - a S&P company).
Interest rate risk
Interest rate risk represents the uncertainty of investment return due to changes in the market rates of interest. The direct effect of movements in interest rates is not material as any surplus cash is predominantly in Indian Rupees, and foreign investors are not permitted to earn interest on Rupee balances.
Liquidity risk
Liquidity risk arises mainly from the Group encountering difficulty in realising assets or otherwise raising funds to meet financial commitments. As the trading volume on the Indian stock markets is lower than that of more developed stock exchanges the Group may be invested in relatively illiquid securities. The Group has no unlisted securities, and its focus is to invest predominantly in mid and small cap listed stocks. However, there remain holdings where there is relatively little market liquidity, which may take time to realise. The Directors do not believe that the market is inactive enough to warrant a discount for liquidity risk on the Group's investment portfolio. ICG Q Limited seeks to maintain sufficient cash to meet its working capital requirements.
The Directors do not believe it to be appropriate to adjust the fair value of the Company's investment in ICG Q Limited for liquidity risk, as it has the ability to affect a disposal of any investment in ICG Q Limited's investment portfolio at the prevailing market price and the distribution of proceeds back to the Company should it so wish.
All liabilities are current and due on demand.
Taxation risk
Taxation risk arises mainly from the taxation of income and capital gains of ICG Q Limited and the Company increasing as a result of changes in the tax regulations and practice in Guernsey, Mauritius and India. The Company and ICG Q Limited are registered with the Securities and Exchange Board of India (SEBI) as a foreign portfolio investor (FPI) with a Category I licence, and ICG Q Limited holds a Global Business Licence in Mauritius and has obtained a Mauritian Tax Residence Certificate (TRC) which have been factors in determining its resident status under the India-Mauritius Double Taxation Avoidance Agreement (DTAA) and General Anti Avoidance Rules (GAAR) under the Income Tax Act 1961 (ITA).
However, with effect from April 2017, the DTAA was amended such that the advantages of investing in India via Mauritius were removed and capital gains arising from investments in Indian companies are subject to Indian Capital Gains Tax regulations. With effect from 22 July 2024 the short-term (investments held for less than 12 months) Indian CGT rate increased from 15% to 20% and the long-term Indian CGT rate increased from 10% to 12.5%. Full deferred tax provision is made for Indian CGT applying to the investment portfolio.
The Group seeks to minimise the impact of these changes in the taxation rates applicable to its capital gains by maintaining its investment strategy of investing in a concentrated portfolio for long-term capital appreciation.
11. Related party transactions and material contracts
Parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial or operational decisions. The Directors are responsible for the determination of the investment policy and have overall responsibility for the Company's activities. Directors' fees are disclosed fully in each Annual Report.
During the period 2025, the investment management fee was equivalent to 1.25 per cent per annum of the lower of the Company's market capitalisation or aggregate value of its assets less current liabilities, calculated and payable monthly in arrears. The Investment Manager earned £555,000 in management fees during the six months ended 30 June 2025 (six months ended 30 June 2024: £761,000 and year ended 31 December 2024: £1,944,000) of which £97,000 was outstanding at 30 June 2025 (30 June 2024: £108,000 and 31 December 2024: £181,000).
From March 2024, the method of calculation for these fees has been updated. Investment management fees receivable from ICG Q are calculated based on the NAV of ICG Q. Investment management fees payable to Ocean Dial Asset Management Limited are based on the assets of ICGF. The calculation of investment management fees payable to Ocean Dial Asset Management Limited remains unchanged.
Under the terms of the Administration Agreement, Apex Fund and Corporate Services (Guernsey) Limited is entitled to a minimum annual fee of US$41,000 or a fee of 5 basis points of the NAV of the Company, whichever is greater. The Administrator is also entitled to reimbursement of all out-of-pocket expenses recoverable by way of a fixed disbursement charge of US$50 per month excluding all international calls and courier. The Administrator earned £45,000 for administration and secretarial services during the period ended 30 June 2025 (six months ended 30 June 2024: £46,000 and year ended 31 December 2024: £96,000) of which £33,000 was outstanding at 30 June 2025 (30 June 2024: £22,000 and 31 December 2024: £24,000).
12. Cash and cash equivalents
Cash and cash equivalents are comprised of:
|
|
Unaudited |
|
Unaudited |
|
Audited |
|
|
Six months |
|
Six months |
|
Year to |
|
|
to 30.06.25 |
|
to 30.06.24 |
|
31.12.24 |
|
|
Total |
|
Total |
|
Total |
|
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
Cash at bank |
4,135 |
|
4,877 |
|
5,307 |
|
Short-term investment |
2,725 |
|
- |
|
4,200 |
|
|
6,860 |
|
4,877 |
|
9,507 |
13. Contingent liabilities
The Directors are not aware of any contingent liabilities at 30 June 2025 and at the date of approving these financial statements.
14. Ultimate controlling party
In the opinion of the Directors of the Company, the Company has no ultimate controlling party.
15. Subsequent events
There are no material events since the end of the reporting period which would require disclosure or adjustment to the financial statements for the period ended 30 June 2025.
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