Quarterly report pursuant to Section 13 or 15(d)

NET (LOSS)/GAIN ON TRADING SECURITIES

v3.24.0.1
NET (LOSS)/GAIN ON TRADING SECURITIES
 9 Months Ended
Dec. 31, 2023
Investments, Debt and Equity Securities [Abstract]  
NET (LOSS)/GAIN ON TRADING SECURITIES TRADING AND AVAILABLE-FOR-SALE SECURITIES AT FAIR VALUE
As of December 31, 2023, and March 31, 2023, trading and available-for-sale securities consisted of:
  December 31, 2023 March 31, 2023
 
Non-U.S. sovereign debt $ 2,370,508  $ 1,029,857 
Corporate debt 1,165,732  1,269,879 
Corporate equity 99,589  65,741 
U.S. sovereign debt 43,231  45,022 
Exchange traded notes 1,393  2,057 
Total trading securities $ 3,680,453  $ 2,412,556 
December 31, 2023 March 31, 2023
Corporate debt $ 127,402  $ 191,082 
Non-U.S. sovereign debt 62,987  40,162 
U.S. sovereign debt 12,108  7,809 
Total available-for-sale securities, at fair value $ 202,497  $ 239,053 

The following tables present maturity analysis for available-for-sale securities as of December 31, 2023, and March 31, 2023:

December 31, 2023
Remaining contractual maturity of the agreements
Up to 1 year 1-5 years 5-10 years More than 10 years Total
Corporate debt 34,691  48,898  43,803  10  127,402 
Non-US sovereign debt 43,581  7,054  5,718  6,634  62,987 
US sovereign debt 9,145  —  1,700  1,263  12,108 
Total available-for-sale securities, at fair value $ 87,417  $ 55,952  $ 51,221  $ 7,907  $ 202,497 

March 31, 2023
Remaining contractual maturity of the agreements
Up to 1 year 1-5 years 5-10 years More than 10 years Total
Corporate debt $ 77,006  $ 82,579  $ 31,486  $ 11  $ 191,082 
Non-US sovereign debt —  33,143  820  6,199  40,162 
US sovereign debt 1,947  2,805  1,725  1,332  7,809 
Total available-for-sale securities, at fair value $ 78,953  $ 118,527  $ 34,031  $ 7,542  $ 239,053 

As of December 31, 2023, the Group held debt securities of two issuers each of which individually exceeded 10% of the Group’s total trading securities - the Ministry of Finance of the Republic of Kazakhstan (Fitch: BBB credit rating) in the amount of $2,357,330 and Kazakhstan Sustainability Fund JSC (Fitch: BBB credit rating) in the amount of $721,133. As of March 31, 2023, the Group held debt securities of two issuers each of which individually exceeded 10% of the Group’s
total trading securities - the Ministry of Finance of the Republic of Kazakhstan and the Kazakhstan Sustainability Fund JSC in the amounts of $1,015,161 and $834,917, respectively. The debt securities issued by the Ministry of Finance of the Republic of Kazakhstan and Kazakhstan Sustainability Fund JSC are categorized as non-US sovereign debt and corporate debt, respectively.
As of December 31, 2023 and March 31, 2023 the Group recognized $342 and $390, respectively, other-than-temporary impairment in accumulated other comprehensive loss.
The fair value of securities is determined using observable market data based on recent trading activity. Where observable market data is unavailable due to a lack of trading activity, the Group utilizes internally developed models to estimate fair value and independent third parties to validate assumptions, when appropriate. Estimating fair value requires significant management judgment, including benchmarking to similar instruments with observable market data and applying appropriate discounts that reflect differences between the securities that the Group is valuing and the selected benchmark. Depending on the type of securities owned by the Group, other valuation methodologies may be required.
Measurement of fair value is classified within a hierarchy based upon the transparency of inputs used in the valuation of an asset or liability. Classification within the hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
The valuation hierarchy contains three levels:
•Level 1 - Valuation inputs are unadjusted quoted market prices for identical assets or liabilities in active markets.
•Level 2 - Valuation inputs are quoted market prices for identical assets or liabilities in markets that are not active, quoted market prices for similar assets and liabilities in active markets, and other observable inputs directly or indirectly related to the asset or liability being measured.
•Level 3 - Valuation inputs are unobservable and significant to the fair value measurement.
The following tables present securities assets in the Сondensed Сonsolidated Balance Sheets or disclosed in the Notes to the condensed consolidated financial statements at fair value on a recurring basis as of December 31, 2023, and March 31, 2023:
Weighted Average
Interest Rate		 Total
Fair Value Measurements as of December 31, 2023 using
Quoted Prices in
Active Markets
for Identical Assets		 Significant
Other Observable
Inputs		 Significant Unobservable
Units
(Level 1) (Level 2) (Level 3)
Non-U.S. sovereign debt 12.51  % $ 2,370,508  $ 1,443,144  $ 927,330  $ 34 
Corporate debt 15.52  % 1,165,732  397,767  751,490  16,475 
Corporate equity —  % 99,589  77,577  1,603  20,409 
U.S. sovereign debt 4.71  % 43,231  43,231  —  — 
Exchange traded notes —  % 1,393  908  485  — 
Total trading securities $ 3,680,453  $ 1,962,627  $ 1,680,908  $ 36,918 
Corporate debt 16.67  % $ 127,402  $ 40,645  $ 86,757  $ — 
Non-US sovereign debt 13.51  % 62,987  50,557  12,430  — 
US sovereign debt 4.37  % 12,108  12,108  —  — 
Total available-for-sale securities, at fair value $ 202,497  $ 103,310  $ 99,187  $ — 
Weighted Average
Interest Rate
Total Fair Value Measurements as of March 31, 2023 using
Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Units
(Level 1) (Level 2) (Level 3)
Corporate debt 15.62  % $ 1,269,879  $ 1,106,584  $ 162,895  $ 400 
Non-U.S. sovereign debt 12.04  % 1,029,857  971,762  54,319  3,776 
Corporate equity —  65,741  62,971  1,808  962 
U.S. sovereign debt 4.22  % 45,022  45,022  —  — 
Exchange traded notes —  2,057  447  1,610  — 
Total trading securities $ 2,412,556  $ 2,186,786  $ 220,632  $ 5,138 
Corporate debt 15.78  % $ 191,082  $ 129,504  $ 61,578  $ — 
Non-U.S. sovereign debt 13.64  % 40,162  39,624  538  — 
U.S. sovereign debt 4.24  % 7,809  7,809  —  — 
Total available-for-sale securities, at fair value $ 239,053  $ 176,937  $ 62,116  $ — 
The tables below present the valuation techniques and significant level 3 inputs used in the valuation as of December 31, 2023, and March 31, 2023. The tables are not intended to be all inclusive, but instead capture the significant unobservable inputs relevant to determination of fair value.
Type Valuation Technique FV as of December 31, 2023 Significant Unobservable Inputs %
Corporate debt DCF $ 16,220  Discount rate 11.1%
Estimated number of years 2 years
Corporate debt DCF 255  Discount rate 74.0%
Estimated number of years 3 months
Corporate equity DCF 20,022  Discount rate 13.0%
Estimated number of years 4 years, 6 months
Non-U.S. sovereign debt DCF 34  Discount rate 48.8%
Estimated number of years 11 years
Corporate equity DCF 387  Discount rate 58.8%
Estimated number of years 9 years
Total $ 36,918 

Type Valuation Technique FV as of March 31, 2023 Significant Unobservable Inputs %
Non-US sovereign debt DCF $ 3,776  Discount rate 48.8%
Estimated number of years 11 years
Corporate debt DCF 400  Discount rate 74.0%
Estimated number of years 3 months
Corporate equity DCF 962  Discount rate 58.8%
Estimated number of years 9 years
Total $ 5,138 
The following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the nine months ended December 31, 2023, and the year ended March 31, 2023:
Trading securities
Balance as of March 31, 2023
 $ 5,138 
Purchase of investments that use Level 3 inputs 35,805 
Deconsolidation of Freedom UA securities (3,927)
Revaluation of investments that use Level 3 inputs 458 
Reclassification to investment in associate (556)
Balance as of December 31, 2023
 $ 36,918 
Balance as of March 31, 2022
 $ 9,142 
Reclassification to level 2 (1,339)
Sale of investments that use Level 3 inputs (5,213)
Purchase of investments that use Level 3 inputs 2,604 
Revaluation of investments that use Level 3 inputs (56)
Balance as of March 31, 2023
 $ 5,138 
The table below presents the amortized cost, unrealized gains and losses accumulated in other comprehensive income, and fair value of available-for-sale securities as of December 31, 2023, and March 31, 2023:
December 31, 2023
Assets measured at amortized cost Recognized impairment loss in Income Statement Unrealized loss accumulated in other comprehensive
loss		 Assets
measured at
fair value		 Maturity Date
Corporate debt $ 127,073  $ (61) $ 390  $ 127,402  2024-2035
Non-US sovereign debt 64,799  (281) (1,531) 62,987  2024-indefinite
U.S. sovereign debt 12,776  —  (668) 12,108  2024-2044
Total available-for-sale securities, at fair value $ 204,648  $ (342) (1,809) $ 202,497 
March 31, 2023
Assets measured at amortized cost Recognized impairment loss in Income Statement Unrealized loss accumulated in other comprehensive
income/(loss)		 Assets
measured at
fair value		 Maturity Date
Corporate debt $ 192,167  $ (402) $ (683) $ 191,082  2023-2035
Non-U.S. sovereign debt 42,456  —  (2,294) 40,162  2024-indefinite
U.S. sovereign debt 8,391  —  (582) 7,809  2023-2044
Total available-for-sale securities, at fair value $ 243,014  $ (402) $ (3,559) $ 239,053 
NET (LOSS)/GAIN ON TRADING SECURITIES
During the three months ended December 31, 2023, and December 31, 2022, net (loss)/gain on trading securities was comprised of:
Three Months Ended
December 31, 2023
Three Months Ended
December 31, 2022
Net gain/(loss) recognized during the period on trading securities sold during the period
 $ 9,353  $ (47,801)
Net unrealized (loss)/gain recognized during the reporting period on trading securities still held at the reporting date
 (14,442) 73,257 
Net (loss)/gain recognized during the period on trading securities
 $ (5,089) $ 25,456 

Nine Months Ended December 31, 2023 Nine Months Ended December 31, 2022
Net gain/(loss) recognized during the period on trading securities sold during the period
 $ 61,276  $ (26,790)
Net unrealized gain recognized during the reporting period on trading securities still held at the reporting date 16,222  65,684 
Net gain recognized during the period on trading securities $ 77,498  $ 38,894 
During the three months ended December 31, 2023 the Group sold securities for a gain of $9,353 and recognized unrealized loss in amount of $14,442. The principal factor contributing to the unrealized net loss is the decline in prices of debt securities within the Kazakhstan Sustainability Fund JSC we continued to hold at December 31, 2023. During the three months ended December 31, 2022 the Group sold securities for a loss of $47,801 and recognized unrealized gain in amount of $73,257.