Schiehallion Fund Ltd (MNTN) Fair Value: +86.9% Upside

Schiehallion Fund Ltd (MNTN) Fair Value Analysis: Why the Stock Looks Undervalued

Schiehallion Fund Ltd (MNTN), a Baillie Gifford-managed closed-ended investment company focused on later-stage private growth businesses, currently trades at GBP 0.02. Our comprehensive fair value assessment places the intrinsic value at GBP 0.04, suggesting substantial upside of 86.9%. With a Quality Score of 74/100, the fund earns a clear "undervalued" verdict from our models.

What Schiehallion Fund Ltd Does

Launched in 2019, Schiehallion Fund Ltd aims to deliver capital growth by taking long-term minority stakes in mature private companies that demonstrate strong transformational potential and a credible path to public markets. The portfolio features high-profile names including SpaceX, Bending Spoons, ByteDance and Databricks. As a growth capital vehicle in the financials sector, it bridges the gap between private innovation and public-market returns for investors.

Recent Performance and Market Context

The fund delivered robust results for the year ended 31 January 2026, with NAV returning 32.6% and the share price surging 64.8% as the discount to NAV narrowed dramatically and even moved briefly to a small premium. Portfolio holdings showed impressive revenue growth, with private company valuations supported by operational progress at key assets like SpaceX. Recent RNS updates in June 2026 continue to highlight NAV stability and positive revaluations, while the company has executed share buybacks and migrated its listing to the London Stock Exchange Main Market to broaden investor access.

Key Valuation Drivers Behind Our Fair Value Estimate

Our 21-model framework incorporates discounted cash flow projections on underlying holdings, peer multiples for comparable growth funds, and NAV-based approaches adjusted for liquidity and sentiment. The primary drivers include:

• Portfolio NAV momentum — Strong contributions from SpaceX and other high-growth names have lifted underlying asset values significantly.
• Discount/premium dynamics — Historical trading ranges and recent narrowing support a higher equilibrium price.
• Growth runway — Exposure to companies staying private longer captures upside that public markets may eventually recognise through IPOs or secondary sales.

The Bull Case vs Bear Case

Bulls highlight the fund's proven ability to access pre-IPO opportunities in transformative sectors, backed by Baillie Gifford's private markets expertise. Recent performance and structural improvements (Main Market listing, tax residency) position it for sustained demand.

Bears point to valuation risk in illiquid private assets, potential concentration in a handful of holdings, and sensitivity to broader risk-off sentiment in growth equities. Private company marks can also lag or surprise on the downside.

Main Risks to Consider

Investors should weigh valuation uncertainty around unlisted holdings, fluctuations in the share price relative to NAV, and sector-specific challenges in private equity and technology. Liquidity in the shares and macroeconomic factors affecting growth stocks also feature in the risk profile.

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Balanced Verdict on Schiehallion Fund Ltd

At the current GBP 0.02 price, Schiehallion Fund Ltd (MNTN) appears materially undervalued according to our models. The combination of strong underlying portfolio performance, improving corporate structure and attractive growth exposure supports the GBP 0.04 fair value target. While risks inherent to private investments remain, the 86.9% upside potential and solid 74/100 Quality Score make a compelling case for further research. Always conduct your own due diligence.

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Frequently Asked Questions

What is Schiehallion Fund Ltd and what does it invest in?

Schiehallion Fund Ltd is a closed-ended investment company managed by Baillie Gifford that seeks capital growth through long-term minority investments in later-stage private businesses with transformational potential, such as SpaceX, Bending Spoons and ByteDance.

Why is Schiehallion Fund Ltd considered undervalued?

Our fair value model prices MNTN at GBP 0.04 against the current market price of GBP 0.02, implying 86.9% upside. This reflects the fund's strong portfolio performance, NAV growth and exposure to high-growth private companies not fully reflected in the share price.

What are the main risks of investing in Schiehallion Fund Ltd?

Key risks include valuation uncertainty in private holdings, potential share price volatility around NAV premiums or discounts, concentration in a few large positions, and broader market sentiment toward growth and private equity assets.