Seraphim Capital’s new space fund will provide investors exposure to a portfolio of space stocks within the rapidly growing industry. Learn about the world’s first space-focused venture fund, Seraphim Space Investment Trust, and discover how to get involved in its IPO.
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Seraphim Space Investment Trust is an actively managed investment trust that seeks to acquire interests in space-orientated companies. It describes these as businesses which produce technologies and services that may benefit the space sector, or businesses that rely on space-derived technologies for navigation, connectivity, and signals.
Its main interest is to generate long-term capital growth through investing in space companies with growth potential at an early stage. With this mind, it aims to deliver a minimum net-asset-value total return of 20% over the long-term. This may be achievable for the business, given that the space industry is consistently seeing lower costs for building and launching satellites and space vehicles. This could help to improve cash flows and balance sheets of the companies in Seraphim’s space fund, as operational costs could be on a downward trajectory over the coming years.
Seraphim’s initial public offering (IPO) is due to complete on 14 July 2021, which will mark its first day of trading on the London Stock Exchange. The fund originally filed for an IPO in June and closed investor applications on 9 July.
Seraphim Space has reported that over 100,000 satellites are expected to be launched over the next decade, which is a leap from the current figure of 3,700 in orbit today. Given this incredible industry growth, Seraphim Space may have chosen to debut on the stock market now as it is an opportune time for early-stage investors to jump on the budding space movement.
Keep an eye out for other UK and international upcoming IPOs >
Seraphim will be selling approximately 180m shares at 100p each. This equals a total funding of £180m. 150m ordinary shares are to be issued by way of the initial placing, subscription offer, and intermediaries offer. The remaining 30m will be issued through direct subscriptions in connection with the company’s acquisition of the initial portfolio.
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The trust plans to buy an initial portfolio of 15 companies with the IPO proceeds, which are shown below. Another four investments may be added before the end of 2021, which are highlighted in bold.
|Altitude Angel||Safe integration and use of drones and UAVs into international airspace.|
|Arqit||Uses transformational quantum encryption technology to keep client data safe.|
|AST SpaceMobile||Building the first and only space-based cellular broadband network for mobile phones.|
|Bamboo Systems||Provides a new generation of ARM based server-class platform that joins compute, storage, and networking together.|
|ChAI||Forecasting commodity prices by applying artificial intelligence to data such as satellite imagery and economic statistics.|
|D-Orbit||First space logistics company that focuses on satellite launch, deployment and orbital transportation.|
|Edgybees||High-precision geo-registration and augmented reality of aerial video in real time to enable life-saving missions.|
|Iceye||Builds and operates its own commercial constellation of SAR satellites to access location data from anywhere on Earth.|
|Isotropic Systems||Developing the world’s first multi-service integrated range of high throughput terminals to support the satellite industry.|
|LeoLabs||The world’s only supplier of commercial radar tracking services for objects in Low Earth Orbit.|
|Nightingale Intelligent Systems||Fully autonomous drone solution that provides security solutions such as aerial robotics to monitor accidents and rescue situations.|
|NuQuantum||Develops quantum cryptography systems and photonics to power communications and computing.|
|Opteran||Reverse-engineers biological systems in order to enable machines to see, sense and navigate better than current AI practises.|
|PlanetWatchers||Geospatial company that uses SAR analysis to enable accurate data driven decisions in the commercial world.|
|QuadSAT||Supplies drone-based antenna testing and tracking solutions to the satellite, defense, wireless and broadcast markets.|
|Satellite Vu||Earth observation company bringing high-resolution thermal imagery and insights into economic activity and energy efficiency.|
|Spire||Leverages proprietary satellite technology to forecast the weather and track maritime and aviation movements.|
|TransRobotics||Provider of advanced sensor systems for all types of robotic systems, on the ground or in the air.|
|Xona Space Systems||First high-performance satellite navigation system that is an alternative to GPS, using small satellites in low-Earth orbit.|
Out of this portfolio, only one company, AST SpaceMobile (ASTS), is available to trade publicly. However, it contains a number of unicorn start-up companies, such as Arqit and Spire Global, which may go live on the stock market in the near future. Three further companies are also reportedly in talks to go public via a SPAC merger.
View upcoming SPAC mergers >
Within the next 6-12 months following the initial public offering, Seraphim plans to increase the portfolio from anywhere between 20 to 50 holdings.
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The nascent space sector is gaining more investor attention as each day passes. Companies such as Virgin Galactic, Boeing, Trimble, Aerojet Rocketdyne and Maxar work with NASA and associated space agencies to develop satellite communications, space vehicles, AI technologies and space tourism services. Read our article on some of the top space stocks and ETFs to watch in 2021, based on revenue and growth potential.
There is also a number of similar space investment trusts that are available to trade publicly. A significant competitor is the Procure Space ETF (YODA), which is Europe’s first pure-play exchange-traded fund that offers investors exposure to intergalactic businesses. This is a popular choice for investors as it tracks a Space Foundation-certified index, but given its relatively small market capitalisation, it may not be available on all broker’s trading platforms.
How can I start trading on the Seraphim Space Investment Trust?
To start trading on newly listed Seraphim shares, open a trading account. You can choose to spread bet or trade CFDs once the share is listed on the platform on its debut trading day.
Is the space industry expanding?
The space industry is expanding rapidly and is expected to reach $1trn in value by 2040. This may suggest that space companies will turn into growth stocks, which generate sales and earnings at a faster rate than the market average. Learn more about growth stocks.
What factors move space stocks?
Space stocks can be affected by a number of factors, including high-profile launches and technological developments within the industry. It is important that you conduct company analysis before deciding on a stock to trade on.
What other space stocks and ETFs can I trade on?
Space stocks and ETFs that are taking the industry by storm include Virgin Galactic and Lockheed Martin, as well as the Ark Space Exploration & Innovation ETF. Browse a full list of space stocks and ETFs to watch right now.