Recommended Plus Rating Reaffirmed for Plato Income Maximiser Limited (ASX: PL8)

December 23, 2021

Plato Income Maximiser Limited (ASX: PL8, or “the Company”) has a dual objective: (1) deliver an income yield, including franking credits and after fees, in excess of that provided by the benchmark (the S&P/ASX 200 Franking Credit Adjusted Daily Total Return Index (tax exempt)); and (2) generate a total return (after fees) in excess of the benchmark over each full investment cycle (typically 3 to 5 years). The investment strategy is implemented by Plato Investment Management Limited (the “Manager”), through an investment in the Plato Australian Shares Income Fund (the “Plato Fund”). The Plato Fund is an unlisted managed fund, which seeks to provide investors an enhanced yield through a dynamically managed investment in a diversified portfolio of domestic equities. The investment strategy is quantitative in nature. It seeks to generate higher than market income by either or a combination of: a) investing in fully franked dividend yielding stocks in the run-up period to the ex-dividend dates; b) investing in forecast high yielding (including franking credits) stocks; and c) exploiting the tax benefits of off-market buy-backs. To achieve its dual investment objective, as well as mitigate dividend trap risk, the Manager also employs a fundamental alpha model that assesses value, business momentum and business quality. PL8 listed on the Australian Securities Exchange in May 2017, however the underlying Plato Fund has a much longer track record with an inception date of 9 September 2011. Over this longer track record, the Manager has delivered on its objectives, delivering a grossed up yield that is typically greater then the benchmark and a total return in excess of the benchmark. Distributions are paid monthly, with PL8 being the only Listed Investment Company (LIC) to do so in the domestic market.

Independent Investment Research (IIR) has reaffirmed its Recommended Plus rating for Plato Income Maximiser Limited (ASX: PL8). PL8 is specifically designed for zero tax-rate investors with the underlying investment strategy designed with retirees front of mind. As such it is suitable primarily for these investors, with investors not within this category not reaping the full benefits of the investment strategy. The Company has provided investors with a regular monthly fully franked dividend and has largely delivered on its investment objectives with the Company consistently delivering an enhanced grossed up yield above the benchmark (S&P/ASX 200 Franking Credit Adjusted Daily Total Return Index, Tax Exempt), as well as meeting the total return objectives more often than not. The team is highly qualified, experienced, stable and proven.

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