Original source：Morgan Stanley MUFG Securities Co., Ltd.First published on Unhidea：Original source date：
Key takeaway
SoftBank’s valuation potential depends on both its net asset value and its discount rate: Morgan Stanley expects AI exposure to support a narrower discount, but the recent decline in Arm’s value and the increase in net debt this year are constraints.
Net assets rose. Why didn’t the share price keep pace?
As of 23 October 2026, SoftBank’s net asset value (NAV) per share was approximately 8,300 yen, up 49.1% from the start of the year; its share price was 4,276 yen, down 2.8% over the same period. Asset value growth and share performance diverged markedly.
The gap is reflected in the NAV discount: it reached 48.4% on 23 October, widening by 27.5 percentage points from the start of the year. In other words, the market priced SoftBank shares at approximately half their net asset value per share, with asset appreciation offset by a deeper discount.
What drove asset appreciation this year, and what offset it?
According to the report’s asset breakdown, the value of the Arm holding rose from 14.6 trillion yen at the end of 2025 to 27.31 trillion yen on 23 October 2026; other assets increased from 26.68 trillion to 34.08 trillion yen. Arm was the main source of asset appreciation this year.
Over the same period, net debt rose from 10.03 trillion yen to 14.49 trillion yen, an increase of approximately 45%. NAV is calculated as “Arm value + other asset value − net debt”, so not all of the appreciation in assets was retained in net assets.
On 23 October, Arm’s value was equivalent to 58% of NAV, other assets accounted for 73%, and net debt was a deduction of 31%. These are proportions relative to net assets, showing that understanding SoftBank’s valuation requires looking at both the value of its holdings and the debt deduction.
Were asset values also weakening as the discount recently deepened?
Yes. From 2 October to the 23rd, SoftBank’s NAV fell from 62.17 trillion yen to 46.9 trillion yen, a decline of approximately 24.6%; over the same period, the value of its Arm holding fell from 41.61 trillion to 27.31 trillion yen, the main source of this decline in net assets.
During this period, the value of other assets fell from 35.04 trillion to 34.08 trillion yen, while net debt remained at 14.49 trillion yen; the NAV discount widened from 42.5% to 48.4%. The share price has recently faced the dual pressure of falling asset values and a deeper discount.
Why does Morgan Stanley still have a 5,500 yen price target?
Morgan Stanley rates SoftBank “hold” with a price target of 5,500 yen. Its valuation references the NAV trend and applies a discount of approximately 40%, below the current discount of 48.4%; its rationale is that greater exposure to AI assets could help narrow the discount.
This re-rating thesis is also affected by investment exits and the valuation environment: the bank lists a recovery in the IPO market, falling interest rates and rising equity values at unlisted companies as upside factors; downside factors are a prolonged bear market, fewer IPOs and more cautious investment decisions.
