This episode breaks down Exor, the Agnelli family's holding company that transformed from a near-bankrupt Fiat into an investment firm centered on Ferrari, healthcare, and luxury. Manager Krishna Mohanraj says Exor's 40-50% discount to its net asset value is an opportunity, not a risk, because management is buying back shares to capture that gap. He likes Ferrari (core asset, recently trimmed to fund buybacks) and Philips (transitioning to health tech), but flags Stellantis (auto maker facing EV transition challenges).
Exor is a long-established investment holding company, tracing its origins to Fiat, founded by Giovanni Agnelli in the late 19th century. This episode is analyzed by Krishna Mohanraj of Diamond Hill, whose core argument is that under the leadership of current CEO John Elkann, Exor has been consisten
The guest for this episode is Krishna Mohanraj (Portfolio Manager, International Strategies at Diamond Hill), who systematically deconstructs the century-long evolution of the Italian Agnelli family's holding company, Exor. The main narrative: Under CEO John Elkann, Exor has transformed from the Fiat industrial group on the brink of bankruptcy into a global investment holding company centered on Ferrari, with a focus on healthcare, luxury goods, and technology. It is also steadily narrowing its NAV discount through buybacks and asset restructuring.
The most significant judgment of the episode: Krishna Mohanraj believes that Exor's NAV discount (approximately 40-50%) is not a risk but an opportunity for long-term investors — management is using a dual framework of "entrepreneurial spirit + financial discipline" to convert the discount into an arbitrage opportunity for self-investment. However, whether the discount can narrow is beyond management's control; investors should bet on NAV per share growth rather than discount convergence.
Krishna Mohanraj believes that Exor's history can be understood through three key leaders, each of whom reshaped the group during a crisis.
Marchionne's contributions: Secured approximately $2 billion from GM to buy out Fiat's put option; almost single-handedly cut costs and restructured operations; after the 2008 financial crisis, Fiat not only survived but successfully merged with Chrysler. Elkann still refers to Marchionne as his "personal mentor and a transformative figure."
The formal establishment of Exor (2009): Elkann consolidated the family's complex shareholding structure (two holding companies, IFI and IFIL) into a single entity, Exor, and moved its registration to the Netherlands (benefiting from exemptions on capital gains and dividend taxes, as well as an extensive tax treaty network). Mohanraj comments: "Compared to family holding companies like Bolloré, Exor's structure is relatively straightforward."
Krishna Mohanraj notes that of Exor's approximately €45 billion in total assets, 70% is concentrated in four listed companies, with the remainder in private investments.
| Asset | % of NAV | Analyst View | Key Data |
|---|---|---|---|
| Ferrari | Previously nearly 50%, now ~25-30% | Bullish (core asset) | Sold approximately €3 billion in shares in February 2025 for buybacks and reinvestment |
| Stellantis | ~10% | Risk warning (cyclical trough) | Extremely low valuation, facing EV transition and overcapacity |
| CNH Industrial | Not disclosed | Neutral (waiting for cycle reversal) | Second-largest global agricultural equipment maker (behind John Deere); new CEO promoted internally |
| Philips | ~17-20% | Bullish (strategic positioning) | Transitioning from consumer electronics to a pure health technology company; currently addressing sleep apnea device recall |
Ferrari's Special Status: Mohanraj emphasizes, "Ferrari is not a car company—its essence is motorsport; selling cars is almost a byproduct." Market consensus supports this view. However, the EV transition will once again test this narrative.
Commonality of Stellantis/CNH/Iveco: All three originate from the former Fiat group, are cyclical/capital-intensive, and are currently at the trough of their respective industries. Mohanraj believes that "apart from Ferrari, none of the other listed assets are overvalued."
| Asset | Analyst View | Key Data |
|---|---|---|
| Juventus (football club) | Negative ("Why hold it?") | Economically insignificant; recent corporate governance scandals |
| Clarivate (data analytics) | Slightly positive | Subscription-based business, provides foundational capabilities for Exor's entry into medical technology |
Mohanraj is blunt about Juventus: "This is family passion, not an investment decision. It does not drive NAV per share growth but introduces governance risk."
Krishna Mohanraj believes that Exor's valuation logic is straightforward, but the discount issue is complex. The key lies in understanding the causes of the discount and management's pragmatic approach.
1. Natural discount for holding companies: The market prefers pure-play businesses over a "basket of assets"
2. Single source of growth: Over the past 3-4 years, nearly all NAV growth has come from Ferrari; excluding Ferrari, the remaining assets are a collection of "cyclical troughs plus structural headwinds"
3. Time mismatch: Management operates on an ultra-long-term cycle, which does not align with the time horizons of most market participants
Mohanraj particularly appreciates Elkann's attitude: "He does not complain that the market is wrong; instead, he views the discount as an opportunity to invest in himself." The 2025 reduction of Ferrari holdings for buybacks is a manifestation of this logic—buying the asset he knows best (Exor itself) at a discount.
Advice for investors: "If you want to invest in Exor, you need an ultra-long time horizon and believe that Elkann's interests are aligned with those of minority shareholders. You should bet on NAV per share growth, not on discount narrowing—the latter is beyond management's control."
Krishna Mohanraj believes that Exor's capital allocation is key to understanding its long-term value, with a clear framework and strict execution.
Mohanraj concludes: "Act like an entrepreneur, but with a rock-solid balance sheet — that is the only way to manage family wealth."
Krishna Mohanraj believes that while Exor's private investments are currently not highly valued, they offer significant strategic option value, particularly in the healthcare technology sector.
| Asset | Industry | Strategic Value |
|---|---|---|
| The Economist | Media | Largest single shareholder, brand value + public mission |
| Institute Meru | Healthcare Technology | Family business, aligned with Exor's culture, helps build healthcare expertise |
| Louboutin | Luxury Goods | High-end women's footwear brand, chose Exor as a "patient owner" |
| Veltec | Energy Tools/Robotics | Precise entry during the 2016 energy downturn |
| Lingotto (Asset Management Platform) | Asset Management | Founded in 2023, manages €6.4 billion in assets, operates independently |
Exor acquired reinsurance company Partnery for approximately $9 billion in 2015, held it for 5-6 years, and then sold it to Covea, achieving an IRR of approximately 9-10%. Mohanraj considers this a "decent deal, but not outstanding." Key lesson: the reinsurance business is better suited to structures with patient capital (such as Berkshire Hathaway), and Exor's experience was "mediocre" due to catastrophe losses exceeding expectations. However, after the exit, Exor brought in talent from Partnery and partnered with Covea to launch an asset management platform — "they never walk away empty-handed."
1. Luxury Goods (already includes Ferrari, Louboutin, China's Shang Xia) — but high-end independent targets are scarce and competition is fierce
2. Technology (via the Vento seed program and venture capital investments) — Elkann joined Meta's board in 2025, gaining a front-row perspective on AI
3. Healthcare Technology (most promising) — Philips + Institute Meru provide a "front-row seat," focusing on imaging, diagnostics, tools, and genomics
Mohanraj concludes: "Five years from now, Exor could become a legitimate player in the healthcare technology sector. Even if not, they will have learned a great deal, changing the face of the group."
| Position | Analyst View | Key Data |
|---|---|---|
| Ferrari | Bullish (core asset) | Once accounted for nearly 50% of NAV, now ~25-30%; reduced by approximately €3 billion in February 2025 |
| Stellantis | Risk warning | Accounts for ~10% of NAV, extremely low valuation, EV transition + overcapacity |
| CNH Industrial | Neutral (waiting for cycle reversal) | World's second-largest agricultural equipment maker; new CEO promoted internally |
| Philips | Bullish (strategic allocation) | Holds ~17-20%; currently in a transition period following the sleep apnea device recall |
| Iveco | Slightly bullish | Spun off in 2022; considering spinning off its defense business; merger rumors with Tata Motors |
| Juventus | Negative ("Why hold it?") | Not economically significant; recent governance scandals |
| Clarivate | Slightly bullish | Subscription-based data analytics company; provides a foundation for healthcare technology positioning |
| The Economist | Slightly bullish | Largest single shareholder; brand value + public mission |
| Institute Meru | Bullish (strategic option) | Family-owned healthcare technology company; helps Exor build expertise in the medical field |
| Louboutin | Slightly bullish | High-end women's footwear brand; chose Exor as a patient owner |
| Veltec | Slightly bullish | Energy tools/robotics company; entered at a trough in 2016 |
| VIA (unlisted) | Slightly bullish | Urban mobility optimization platform; Exor holds ~9%; has confidentially filed for an IPO |
1. Ferrari is not an automotive company (Krishna Mohanraj) — its essence lies in motorsport, with car sales as a byproduct. Market consensus supports this view, but the EV transition will test this narrative once again. Exor has reduced its Ferrari concentration to 25-30% through stake sales.
2. NAV discount is an opportunity, not a risk (Krishna Mohanraj) — Exor's share price trades at a 40-50% discount to NAV, and management is converting this discount into self-investment through buybacks. However, investors should bet on NAV per share growth, not discount narrowing — the latter is beyond management's control.
3. Exor's capital allocation framework = entrepreneurial spirit + financial discipline (Krishna Mohanraj) — the former means "building great companies with great people," while the latter means debt is always kept at 10-20% and primarily in bonds. Mohanraj comments: "This is the only way to manage family wealth."
4. Juventus is a family passion, not an investment decision (Krishna Mohanraj) — "It does not drive NAV per share growth but introduces governance risk. A fair question is: why hold it?"
5. The real value of the PartnerRe transaction lies not in financial returns (Krishna Mohanraj) — the IRR is around 9-10%, "mediocre." However, Exor learned that reinsurance is unsuitable for a public market structure and brought back talent along with an asset management partnership with Covea — "They never come back empty-handed."
6. Healthcare technology is the most promising direction for Exor's future (Krishna Mohanraj) — Philips + Institute Meru provide a "front-row seat." Mohanraj judges: "Five years from now, Exor could become a legitimate player in the healthcare technology space."
7. Elkann's decisive nature stems from crisis experience (Krishna Mohanraj) — "When you have to make a decision, make it. If it's wrong, correct it. There is no 'thumb-sucking' (hesitation) as Buffett describes." This lesson applies equally to long-term investors: do not use "long-term" as an excuse to avoid uncertainty.
8. Exor's NAV growth comes almost entirely from Ferrari (Krishna Mohanraj) — Excluding Ferrari, the remaining assets are a collection of "cyclical troughs + structural headwinds." This is the core reason for the persistently high discount and a risk investors must confront.