Marcin Klopot, CFA

Thank you to CFA UK for inviting me to speak at their annual Sustainability conference and to Oliver MacArthur, CFA for excellent moderation! With stiff competition from other concurrent sessions, I was very pleased to see a full room for my session on decarbonising infrastructure ☺️ I shouldn’t be surprised really - infrastructure is a very exciting asset class and even more so now, when it’s the cornerstone of the global transition to Net Zero. My session covered two main themes: 1) decarbonisation of hard to abate sectors and 2) investment in climate solutions. On the former, I talked about transitioning airports, with examples of scopes 1 and 2 emission reductions coming from electrifying ground vehicles and generating renewable energy through installing solar farms on disused airport land. For Scope 3 emissions, SAF plays a key role and there was a lot of interest in our work with GrainCorp to explore the creation of SAF refining industry in Australia, as well as the work of MAG (Airports Group) on SAF with Fulcrum BioEnergy, Inc. and their waste-to-fuel refinery. When it comes to climate solutions, we covered another one of our portfolio companies: GreenGasUSA and their exciting work on capturing methane emissions from waste streams and purifying it into pipeline quality renewable natural gas. With the number of questions I received during and after my session, we could have easily doubled my slot to 2 hours - something to consider for next year Will Goodhart? 😉 IFM Investors Luis Strengari Photo Credit: Arun Kelshiker CFA, CAIA #sustainability #infrastructure #energytransition #stewardship #climatesolutions #climatechange #netzero

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Lord Callanan, DESNZ minister for Energy Efficiency and Green Finance, speaking today at The Investment Association Sustainabilty & Responsible Investment conference in London. In amongst an interesting discussion, a couple of nuggets for policy geeks (even if specific dates are still missing): - UK Taxonomy consultation will be out soon - Also planning to consult shortly on transition planning disclosures - Green jobs action plan and report from Solar Energy Taskforce also coming. #TheInvestmentAssociation Isha Gupta | Rosalind Fergusson

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I'm pleased we've launched our latest Alexa Capital report "Investing in the Energy Storage Revolution" offering a deep dive into this fast-growing sector. We've leveraged our insights from active private capital raising and M&A to help public markets investors understand dynamics. A few quick highlights: - The report analyses how by stacking storage revenue streams, investors can optimise profitability and mitigate risks associated with market fluctuations - We also explore how growth in this market has been driven by technology advances, decreasing costs and robust policy support, and a perspective on the future outlook - We also provide an analysis of upstream and midstream value chain elements (incl. minerals extraction, processing, manufacturing and assembly), and downstream activities such as recycling and repurposing. Battery storage continues to be a critical building block of the energy transition, where Alexa Capital deploys industry insights and experience to mobilise capital solutions. #EnergyStorage #EnergyTransition #AlexaCapital #EnergyStorage #EnergyInnovation #CleanEnergy #Cleantech #ResearchReport #PublicMarkets #AlexaCapital

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2024 is delivering on its promise to be a big year in #geopolitics with Rishi Sunak calling a UK General Election for 4 July. Absent major surprises, we don’t expect this one to be a market moving event. The opinion polls are strongly skewed towards a victory for Keir Starmer’s Labour and macro-economic policy differences are far smaller than they were in 2019 when Boris Johnson squared up against Jeremy Corbyn. November’s election in the US is a different matter altogether. The polls are close enough for either Biden or Trump to win the Presidency and there are major geopolitical forces hanging on the outcome. See the blog post for more details including a chart of UK GDP, inflation and base rates since 2010. Not a promising backdrop for the incumbent. https://lnkd.in/dPUVicu9

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Thames water - Washed up? Years of under investment in infrastructure and huge dividend payments to private equity owners have left Thames water with an unsustainable balance sheet in terms of debt burden and leverage ratios In a normal restructuring Equity holders would have to be completely wiped out and debt would have to be restructured extended and interest costs reduced for the company to survive Thames waters owners Kemble have missed a payment and their bonds reflect the reality of bankrucpy trading in the teens ( .17) .... however the operating company which is structurally ring fenced and asset rich has bonds trading at or around 70 cents on the dollar, indicating that some form of bailout is forthcoming and that the assets have value due to strong cash flow and potential for sale to third parties. My view is that public ownership should solve the problems in the long-term however existing investors need to be penalized in order that public ownership "aquires, nationalises buys" the company at a price which gives the UK an asset where leverage and debt are relatively speaking ...lower than they are now... That will give the company the ability to service its interest requirements from cash flowgoing forward ie less debt.... Currently that is not the case in fact their leverage ratios are so high that they are now trading at a yield which is disproportionately high for an investment grade company Current yield metrics for Thames water bonds indicate a spread of 200 basis points over... putting them firmly in high yield territory implying a BB rating So a bailout and nationalization is most likely on the cards and the best way forward for Thames water ....but we the public as taxpayers should insist that a significant write down of equity and debt occur before that happens in order that they can stand on their own two feet going forward #nationalisation #thameswater #bonds #water #highyield #markets #investing That is not good for a regulated public infrastructure company especially one that ostensibly is still investment grade Thames Water could benefit from a spell of public ownership - https://on.ft.com/3UqANRX via @FT

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In response to a parliamentary question inspired by UKSIF’s Energy Report, the government has confirmed there are 1,530 energy projects waiting for a grid connection. If we can fix the grid, we can drive huge volumes of private capital into the UK’s #netzero transition whilst creating thousands of jobs and helping to address #costofliving challenges. https://lnkd.in/egXCgW35

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With our great news yesterday, Coinmerce Capital is at the forefront of the next generation of managers! Join me later today at AIMA - The Alternative Investment Management Association Next Generation Manager Forum 2024 where I will participate on a panel focusing on asset raising. #cryptomanager #nextgeneration #London Coinmerce

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Check out our co-founder Bixuan Xu's latest interview with Bloomberg - you go girl!

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We are delighted to see our research into endgame options published by Institutional Asset Manager: https://lnkd.in/e5EreupQ To read the full research paper 'Strategies for winning the endgame' written by Arif Saad CFA and Panashe Bera FIA, visit: https://lnkd.in/erCgshn5 Capital at risk. For professional investors only. #FuduciaryManagement #Endgame #PensionSchemes

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The UK IPO market is showing signs of life at last and it was great to see plenty of interest in a float from a diverse range of growth companies at our recent IPO conference. #Londonstockexchange #IPO #Investec

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Last week, industry leaders gathered at World Hydrogen UK 🇬🇧 to discuss the latest trends and challenges in the hydrogen sector. The conversations on investment and funding for hydrogen projects highlighted a complex mix of enthusiasm and caution. 🔄 The reluctance to invest heavily in green hydrogen, despite its promising potential, underscores the critical need for strong off-taker agreements, governmental financial support, and creative financing strategies to ensure project viability and attract investor confidence. 🌱📈 These factors are crucial not only for the success of individual projects but also for the overall growth of the sector, indicating a strategic move to align policies, industry, and financial stakeholders. For more insights on navigating the hydrogen investment landscape, connect with me! 💼🔍 Click here to read their key takeaways from the event: https://lnkd.in/eN-_wD7B #GreenHydrogen #HydrogenPower #HydrogenProduction #FinanceWithPurpose #WorldHydrogenLeaders

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What might a Labour government mean for the economy? In the latest abrdn Macro Bytes #podcast, Luke Bartholomew and I spoke to Lizzy Galbraith. Labour would face a very constrained fiscal situation, given the parlarous state of the public finances, growing demand on the state, and the party’s intention to stick with the debt-based fiscal rule. It proposes a supply-side reform focused economic policy including planning liberalisation, green industrial policy, and closer relations with the EU, to drive stronger growth and relieve some of the constraints. For now, we are not revising up our UK economic forecasts - but we will keep a watching brief. That may mean that the fiscal rules are eventually changed. The shadow chancellor has spoken about a fiscal rule based on net worth - ie taking account of national assets as well as debt - which could eventually give more fiscal room.

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Just in. Our Q1 Public Engagement Report, explores carbon capture, utilisation and storage and the implications for companies relying on it to meet their net-zero emission targets. The report also covers how the growth of sustainable bonds has reinforced the case for credit engagement, and finally if Asian regulatory reforms are helping to improve corporate governance and unlock shareholder value across the region. Michael Benedict Yamoah, Shoa Hirosato, Ross Teverson, Haonan Wu https://bit.ly/49WmJ78

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High-emitting sectors need vast volumes of capital to reduce their emissions, and while transition finance is currently nascent, it presents an opportunity for future decarbonisation and to drive low carbon growth of the UK economy and elsewhere. Thanks to Vanessa Havard-Williams for inviting me to join the Expert Group that is supporting the Transition Finance Market Review, exploring how transition finance can be scaled at pace and with integrity.

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Global commodity prices are in an upswing, and we think they have passed the trough for the cycle. Demand appears to be lifting and the supply-side is ‘super-squeezed’. So, what’s next? HSBC’s Paul Bloxham and Jamie Culling explore. To find out, read our free to view report here 👉 https://grp.hsbc/6048evV0O #HSBCResearch #Research #Commodities #ThoughtLeadership

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Iceland‘s new Minister of Finance yesterday published a medium-term fiscal strategy for 2025-2029. The strategy had been hotly anticipated by the markets to see how the Government would respond to a series of fiscal shocks this year, including disaster relief and various cost-of-living subsidies to lower income workers to facilitate Collective Labour Agreements signed last month. 💡 The strategy matters to markets for three reasons: 1) It is an indicator of the “fiscal stance”, which is a measure of whether Government demand management is conducive to disinflation, and therefore to rate cuts. 2) It is an indicator of the near-term supply of government bonds, which can influence their price/yield. 3) It is an indicator of the overall credit of the central government. 🤔 In a note to clients yesterday, we gave our first impressions: -Despite the fiscal shocks, the Government is still targeting broadly unchanged fiscal balances from its previous medium-term strategy, reaching an overall surplus in 2028 (the primary balance will remain in surplus throughout). -The cyclically adjusted primary deficit is estimated to decrease materially this year, which would suggest that the fiscal stance is restrictive. As a fan of less engineered yardsticks, I’d be tempted to instead look at the raw primary balance inclusive of disaster relief, which is actually deteriorating by about 0,5-1,0% GDP (albeit temporarily). Either way, the fiscal stance is unlikely to be expansionary enough to significantly derail the disinflation process. -The Government expects to achieve a balanced budget by keeping expenditure growth in check, partly via clearly articulated new initiatives for consolidation (credible) and unidentified ambitions for consolidation (less credible), which will cause government expenditure to GDP to decline. -However, the headline figures paint a slightly misleading picture, as some de-facto government expenditures are moved “off-balance sheet” via public corporations not recorded under the fiscal balance. This is the case for the equity release scheme offered to victims of the volcanic eruptions, estimated to cost c. 0,6% in direct outlays in 2024, as well as various on-lending schemes. -The debt position doesn’t lie, as all those off-balance sheet measures show up there. The good news is that debt will remain stable at a low level of just over 30% GDP until 2027, before declining. You could argue the government should be targeting more aggressive deleveraging given our position in the cycle, but I’ve also gotta be honest - this is a picnic of a debt trajectory relative to the G7. -Despite the fiscal shocks, net issuance of government debt this year is not expected to increase from previously announced targets, as the government aims to raise cash by selling its remaining share in Islandsbanki. The sale is also expected to weigh on the supply of government paper next year, when net issuance is expected to decline to only ISK 20bn / $140m.

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📣 📈 Maximise the UK’s investment potential! The BVCA is in parliament today to launch our #Manifesto for #Growth with new findings from our latest Research Data from our Report on #Investment Activity. The #privateequity and #venturecapital industry is a partner for growth and we will work with all parties to share what it will take to maximise investment in UK businesses. Today's data reveals that the industry invested £20.1bn in 2023 directly into UK businesses This investment is supporting companies in every region, most (58%) of which were based outside London I wanted to thank colleagues across the BVCA team and our membership for their support in helping to develop our Manifesto. They’ve helped to make it an essential read for anyone looking to identify new opportunities to unlock growth in the UK. It outlines how the next government can work with private capital to: Invest in the UK’s #SME population Progress the #Netzero transition Help bridge the #scaleup gap Back UK #pension savers Boost #innovation Ensure SMEs can access the talent they need And more… As Michael Moore puts it, “private capital is a key partner for driving growth in every nation and region of the UK, but investment by the industry could be even greater with the right policy environment in place”. Sarah Adams, Isobel Clarke, Juliette Gerstein, Suzi Gillespie, James Gribben Patricia Sebastian Hind Jbala Adèle YanLun Martin Senk Ewa Skornas Tom Taylor Chris Elphick Olivia Green Catherine Fredette Nicky Bason Will Todd William Crisp Mia Forti Read more here: Press release - https://lnkd.in/eaE2UdXW Manifesto – https://lnkd.in/e4v8vMZ8 RIA – https://lnkd.in/eR_p7sdf

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