Norway’s wealth fund made record returns, looking at Uber IPO

Norway's central bank building in Oslo. (REUTERS/File Photo)
Updated 04 May 2019

Norway’s wealth fund made record returns, looking at Uber IPO

  • Fund is built on revenues from domestic oil industry
  • Welcomes wave of recent listings by tech unicorns

OSLO: Norway’s $1.1 trillion sovereign wealth fund, the world’s largest, made record returns on investment in the first quarter amid a surge in tech stocks.
Separately, the fund is assessing whether to make an investment in ride-hailing company Uber Technologies Inc. , which is planning an initial public offering, its chief executive told Reuters.
The fund earned 738 billion Norwegian crowns ($84.15 billion) for the January-March period, the highest amount it has ever recorded.
When measured in terms of the fund’s international currency basket, the return for the quarter stood at 9.1 percent, beating its benchmark, it added.
“The first quarter was an exceptionally good quarter,” fund CEO Yngve Slyngstad told reporters.
Apple Inc. made the most positive contribution to the return in the first quarter, the fund said in its quarterly report, followed by Microsoft and Amazon.
The investments that made the most negative contributions were pharmaceutical firm AbbVie, bank Swedbank and US consumer services firm CVS Health.

Tech unicorns
Overall, out of the 10 largest equity holdings in the fund, five of them are US tech companies. The top three equity holdings are Apple, Microsoft and Alphabet.
The fund participated in the initial public offerings of tech firms Lyft and Weimob in the first quarter, and in the present quarter it is examining the listings of two large companies, including that of Uber, Slyngstad said.
The fund has previously said it wished more companies, and particularly tech companies, had sought public listings, enabling the fund to invest in these fast-growing companies.
Slyngstad welcomed the recent wave of public listings by tech firms, but reiterated that they could be seeking listings at an earlier stage so the fund can capture the fruits of their growth.
“This development of these large unicorns coming to the exchanges is something we view positively,” Slyngstad said in an interview on the sidelines of a news conference.
“We are of course pleased that more companies have decided to go to the stock exchanges. We appreciate the transparency and the liquidity of the public markets.
“From our point of view, an earlier listing is better than a later listing.”


India opens vast railway network to private players

Updated 02 July 2020

India opens vast railway network to private players

  • The 167-year-old train network carries 20 million passengers daily
  • India’s railway ministry said it would now permit businesses to run trains along 109 routes
MUMBAI: India has opened up its vast railway sector to private companies, allowing firms to operate trains on certain routes, in a bid to boost its stuttering, virus-hit economy.
The 167-year-old train network carries 20 million passengers daily but is plagued by deadly accidents, rickety infrastructure, lack of modern amenities and poor investment.
In an announcement late Wednesday, the railway ministry said it would now permit businesses to run trains along 109 routes, inviting bids from firms weeks after New Delhi opened up coal mining to the private sector.
“This is the first initiative of private investment for running passenger trains over Indian Railways network,” the ministry said in a statement.
“The objective of this initiative is to introduce modern technology rolling stock with reduced maintenance, reduced transit time, boost job creation, provide enhanced safety, provide world class travel experience to passengers,” it added.
The project will require an investment of $39.8 million and private players will have to pay the government fixed haul charges and a percentage of profits determined during the bidding process.
Prime Minister Narendra Modi has sought to privatize a range of industries that have been under state control for decades, sparking criticism from the opposition Congress party.
“Now the government is in a desperate mood to sell a great chunk of one of our largest national asset #IndianRailways,” Congress politician Adhir Ranjan Chowdhury tweeted.
“Privatization cannot be construed as a panacea of railways malady,” he added.
The tottering network is notorious for accidents, with 15,000 passengers killed every year according to a 2012 government report that described the deaths as a “massacre.”
Asia’s third-largest economy has been clobbered by the pandemic and a months-long lockdown, growing at its slowest pace in at least two decades last quarter.
The shutdown, which put millions out of work overnight, is widely expected to plunge the country into recession.
Fears for the economy prompted the government to allow many businesses to resume operations starting last month despite an ongoing increase in infections, which have now crossed 600,000.
Even before Modi announced the lockdown in late March, the economy was struggling to gain traction with sluggish growth, record unemployment and a flurry of bad loans making banks reluctant to lend.