Power/utilities/infra/telecos

The Generac (big US power products manufacturer) results call had a good set of quotes, namely that electricty demand will be strong and decades of underinvestment spell trouble.

We agree. Data centers, “greenify” everything by electrifying everything, should be a relatively strong multi-year thematic.

We are trying to play that in a few ways. For example, through exposure to regulated utilities in infrastructure (here, via RARE, but also through other specialist managers)…

…and through teleco exposures (in direct equity portfolios we have TLS and (perhaps a little sufferingly at the moment) SPK. The telecos are trying to get directly into data centers, but in general the ownership of the fibre assets and infrastructure that the data runs over means they should benefit.

We also have reasonable exposures to utilities directly via AGL, and ORG (often held in the manager portfolios).

And then there’s the property / REIT / G-REIT exposures, which do come with data centers in them (the A-REIT index is massively influenced by GMG).

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