The Nippon Active Value Fund (NAVF), the London-listed investment trust focused on small and mid-cap Japanese companies, has delivered steady performance amid improving market conditions in Japan.

At the end of September 2025, NAVF reported net assets of £429.4 million and a net asset value (NAV) per share of 225.24p. Shares were trading at 218p, representing a modest discount of around 3.2% to NAV. The trust’s share price has risen by 129.8% since launch, compared with a NAV increase of 141.4%, illustrating NAVF’s long-term track record of capital growth.

NAVF’s portfolio remains heavily weighted towards industrials and healthcare, which together make up over 60% of net assets. Key holdings include Hogy Medical, Eiken Chemical and Fuji Media Holdings. The trust’s portfolio is largely invested in equities (97.7% of assets), with valuation metrics showing a price/book of 1.2×, a price/earnings ratio of 12.1×, and an EV/EBITDA of 8.2×. Cash and net working capital account for roughly 40% of the market cap, offering liquidity and optionality for further investment.

The trust’s investment strategy continues to focus on undervalued companies with strong cash reserves or realisable assets, with an active approach that includes engagement with management. NAVF has recently pressed portfolio companies, including Fuji Media, on structural reforms and asset sales to unlock value.

The fund’s adviser, Rising Sun Management, notes that sentiment towards Japanese equities is improving. Investors are encouraged by corporate governance reforms, growing liquidity as the Bank of Japan reduces its equity ETF holdings, and renewed interest from both domestic and international investors.

NAVF remains focused on long-term value creation through selective stock picking, active engagement with management, and a diversified portfolio of smaller companies, while maintaining a substantial liquidity buffer to support further opportunities in the Japanese market.

In the Q1 2025 update below, Gifford Coombs and Paul ffolkes Davis update investors on progress made in Q1 with a particular focus on events at Fuji Media Holdings