Australia | Oct 17 2022
Download related file: FY22-LIC-LIT-Review
A Listed Investment Company (LIC) is a listed investment vehicle that offers investors access to a diversified portfolio of shares in other companies also listed on the stock market. Also known as Listed Investment Trusts or Listed Managed Investments.
FY22 LIC & LIT Review
The FY22 earnings season wrapped up at August-end. This report looks at the listed investment company (LIC) and listed investment trust (LIT) share/unit price and pre-tax net tangible asset (NTA) and net asset value (NAV) performance for the financial year period ending 30 June 2022 (FY22) as well as looking at the dividends/distributions declared for the period and dividend coverage of the LICs.
(Full report attached)
Outlook
As has been experienced in the first few months of the FY23 period, markets are expected to highly volatile in the upcoming financial year. With inflationary pressures resulting in reserve banks globally undertaking an aggressive rate hike regime, there will likely continue to be downward pressure on the market until the rate hikes peak. Investors should be patient and ensure they understand the investment strategy and mandate of the LIC or LIT that they are invested in or seek to invest in and the impact that the current environment presents for any given investment strategy.
Investors should take note of a LICs dividend coverage noting that a number of LICs rely on capital gains and the payment of tax to be able to maintain the dividend. Those LICs with low levels of reserves and franking credits may be exposed to dividend cuts in the upcoming financial year period.
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This publication has been prepared by Independent Investment Research (Aust) Pty Limited trading as Independent Investment Research (“IIR”) (ABN 11 152 172 079), an corporate authorised representative of Australian Financial Services Licensee (AFSL no. 410381. IIR has been commissioned to prepare this independent research report (the “Report”) and will receive fees for its preparation. Each company specified in the Report (the “Participants”) has provided IIR with information about its current activities. While the information contained in this publication has been prepared with all reasonable care from sources that IIR believes are reliable, no responsibility or liability is accepted by IIR for any errors, omissions or misstatements however caused. In the event that updated or additional information is issued by the “Participants”, subsequent to this publication, IIR is under no obligation to provide further research unless commissioned to do so. Any opinions, forecasts or recommendations reflects the judgment and assumptions of IIR as at the date of publication and may change without notice. IIR and each Participant in the Report, their officers, agents and employees exclude all liability whatsoever, in negligence or otherwise, for any loss or damage relating to this document to the full extent permitted by law. This publication is not and should not be construed as, an offer to sell or the solicitation of an offer to purchase or subscribe for any investment. Any opinion contained in the Report is unsolicited general information only. Neither IIR nor the Participants are aware that any recipient intends to rely on this Report or of the manner in which a recipient intends to use it. In preparing our information, it is not possible to take into consideration the investment objectives, financial situation or particular needs of any individual recipient. Investors should obtain individual financial advice from their investment advisor to determine whether opinions or recommendations (if any) contained in this publication are appropriate to their investment objectives, financial situation or particular needs before acting on such opinions or recommendations. This report is intended for the residents of Australia. It is not intended for any person(s) who is resident of any other country. This document does not constitute an offer of services in jurisdictions where IIR or its affiliates do not have the necessary licenses. IIR and/or the Participant, their officers, employees or its related bodies corporate may, from time to time hold positions in any securities included in this Report and may buy or sell such securities or engage in other transactions involving such securities. IIR and the Participant, their directors and associates declare that from time to time they may hold interests in and/or earn brokerage, fees or other benefits from the securities mentioned in this publication.
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