Patria Private Equity Trust - Market slowdown limited returns in H125

Patria Private Equity Trust (PPET) reported a moderate 2.6% NAV total return in H125, as its near-term return potential remains constrained by subdued private equity (PE) market activity. PE transaction volumes moderated after the tentative rebound in late 2024, primarily due to geopolitical uncertainty (most notably the US tariff turmoil). This, together with the pause in US rate cuts, led to delayed transactions and a conservative stance towards end-March 2025 portfolio valuations among general partners. That said, PPET's long-term performance remains strong with a c 14% NAV total return per year (and a 13.4% per year share price total return) over the last 10 years. While the manager plans for subdued market conditions through the rest of FY25, he remains positive in the medium term given the US$1.2tn of dry powder accumulated across the industry, of which 24% is held for four years or more. In this context, we note PPET's maturing portfolio, half of which has been held for at least four years, potentially providing good exit opportunities when the PE markets pick up.

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