Serena Energia – Brazilian Energy Transition Growth Engine

Brazil is one of the largest emerging markets economies thanks to its enormous agricultural and mineral resources. But it is often overlooked that it is highly exposed to the Energy Transition Megatrend, being blessed with another extremely valuable resource – renewable energy. One company which has been driving incredible growth in wind and solar assets is Serena Energia, a top 30 investment at Utilico Emerging Markets Trust Plc. Founded in 2008, Serena Energia was established by CEO Antonio Bastos who had a vision of the abundant opportunity for hydro, wind and solar developments in Brazil.


Hear from our Deputy Portfolio Manager, Jonathan Groocock, as he provides a market overview and a portfolio update on UEM's performance for March.

KINX video overview

Our Senior Analyst, Mark Lebbell, has provided an insight into one of UEM's top holdings, KINX Inc. KINX operates Korea’s leading internet exchange, as well as number of interconnection data centres.

Vietnam video overview

Jacqueline Broers, our Deputy Portfolio Manager, has shared an update from her trip to Vietnam, where she highlights why the population dynamics should bring investment opportunities across the telecom, utilities and infrastructure sectors.


Hear from our Deputy Portfolio Manager, Jacqueline Broers, as she provides a market overview and a portfolio update on UEM's performance for February.

Korea Internet Neutral Exchange Inc. – a transformative year ahead

Korea Internet Neutral Exchange Inc. (“KINX”), a key digital infra holding of Utilico Emerging Markets Trust plc, is a leading provider of neutral internet infrastructure services in South Korea. It operates Korea’s leading internet exchange as well as number of interconnection data centres. It has doubled revenues and net profits since 2018. UEM has been following KINX for over a decade and it has been part of UEM’s portfolio for the last five years. UEM now holds over 5% of the company, which has a market cap of £300m and it is now one of UEM’s top 10 holdings.

Vietnam – the darling of Asia?

In 2024, Vietnam is expected to be one of the world’s top 20 highest growing economies with forecasted GDP growth of 5.8%. This surpasses the global average of 2.3% and is higher than regional peers. So, what is driving this growth? Vietnam has strong underlying fundamentals, with solid demographics driving their median to long term GDP growth. As the increase in GDP per capita will drive the prospects of a better quality of life and higher wages, Vietnam is expected to reach higher urbanisation levels for the region by 2030. Increased urbanisation typically results in improved productivity and subsequently improved economies of scale, in turn providing growing investment opportunities within the utility, infrastructure and telecom sectors that support it.

Emerging Markets and the Decarbonisation Challenge

Societies have often impacted environments, with adverse consequences for themselves and the rest of nature. Phenomena such as rapid population growth and innovation in the 20th century resulted in increased consumerism, urban sprawl, and globalisation, bringing a first wave of environmentalism. Successful implementation of environmental policy requires an alignment of governments and businesses, as well as broad support from local populations. For individual countries, policy adjustment must balance the pace of transition to net zero with the various levels of economic and social development, whilst factoring in the particular resource base which will be unique to each country and region. What might be appropriate for advanced economies such as the UK, which targets net zero by 2050, may be unachievable for developing nations such as India, which instead is targeting net zero by 2070.


Last month we stated "We are now ready to say that 2024 will be the year that this bull market grows up" when covering the section on market implication in our last edition. Given the rally we have seen in equities already, we have not been disappointed. We remain confident that US financial markets will continue to perform strongly this year, thanks to growing corporate profits, continuing disinflation, and easing monetary conditions in the second half of the year. Equity markets are not priced to reflect any material probability of a recession. Any meaningful economic slowdown would weigh on corporate profits, but we believe the Federal Reserve has the levers to re-stimulate growth if unemployment or deflation become problems.


Hear from our Deputy Portfolio Manager, Jonathan Groocock, as he provides a market overview and a portfolio update on UEM's performance for January.

Megatrend Update: Energy Transition

Jonathan Groocock, Deputy Fund Manager, discusses his key findings of Energy Transition Megatrend experienced during 2023 and his outlook for 2024. Jonathan discusses his key findings of the Energy Transition megatrend experienced during 2023, and his outlook for 2024 covers: renewable energy capacity growth; improving competitiveness of solar PV energy; and, further investment in grid infrastructure and energy storage solutions.

Megatrend Update: Global Trade

Jacqueline Broers, Deputy Portfolio Manager, provides an update on one of the key megatrends for UEM, Global Trade. In this update, she covers the macro challenges for Global Trade experienced in 2023, how global supply disruptions have been dealt with across emerging markets post the destocking phase following Covid-19, and higher inflation and interest rates leading to slowing global demand for goods. The report highlights two underlying themes for FY24: the continuing shift in global trade towards EM; and, further diversification of supply chains including geopolitical and climate factors.

Megatrend update: Digital Infra

Our Senior Analyst Mark Lebbell provides an update on digital infra, one of the key megatrends for UEM. In this video, he describes the global digital infra megatrends across emerging markets including faster, more ubiquitous internet access, further digitalisation of everyday transactions and payments, and more outsourcing of IT infrastructure and functionality to specialists. Mark provides an outlook for 2024, including: current holdings well positioned to capitalise on positive digital infra megatrend, there are increasing expectations for positive financial results and share performance from core holdings, and UEM continues to closely monitor markets for new opportunities in the digital infra space.

Middle East Update: Navigating Regional Risks to Find Alpha

As a follow up to the Insight published in December 2023, our Central and Eastern Europe Investment Strategist, George Velikov, has created a video covering the key points.


Omne trium perfectum. This trio of Latin words, in principle, suggests that all good things come in threes. We believe it is a very apt description of where we find ourselves in the current investment cycle at the beginning of 2024. Even though 2023 was a strong year for returns across many asset classes, we believe 2024 will see a continuation of this strength, and it is more likely than not to last into 2025, making for possibly another two years of strong returns. The premise underlying this constructive view can be distilled down to a simple fact - we are now in a new cycle of easier monetary policy where all good things for risk assets tend to follow. Such a cycle takes time to run its course fully, implying that market conditions will probably be supportive for risk asset markets for all of 2024 and most, if not all, of 2025. According to Alpine Macro research, the average price gain in US stocks in the two years following a bear market is about 60%. So far, the S&P 500 index has risen 32% from its 2022 lows, which supports the view that more price gains can be expected this year.


Hear from our Deputy Portfolio Manager, Jacqueline Broers, as she provides a market overview and a portfolio update on UEM's performance for December.


As we draw toward the end of another eventful investing year, evidence suggests that the fog of uncertainty around the course of inflation has finally cleared. Of course, some voices will continue to argue that inflation will remain sticky and that the last mile of disinflation will be the hardest. Yet, regular readers of this letter will know we have never subscribed to this dubious theory. Could we be on the cusp of a new US cycle where we could see a Goldilocks-type economy where conditions are ‘just right’, typically characterised by a combination of low inflation, low unemployment and steady economic growth? Read on to find out more.

InPost S.A. – reshaping e-commerce logistics

InPost is Europe’s biggest operator of automated parcel machines (APMs) and one of the fastest growing e-commerce logistics infrastructure players. Founded in Poland in 2000, InPost went public on Euronext Amsterdam in 2021. The group boasts an impressive network of 21,000 APMs in Poland, 6,000 in the UK, and 6,000 across Western Europe, as well as having an additional 27,000 pick-up-drop-off points. This expansive infrastructure enabled the delivery of 745 million parcels in 2022, a 22.4% increase from the previous year, generating €1.63bn in sales, €440m in EBITDA, and €105m in profit. Find out more about this investment and why it is in our top twenty holdings.

Investee Insight: Pertamina Geothermal Energy

Our team recently travelled to #Indonesia to visit the Kamojang geothermal facility, which is operated by PT Pertamina Geothermal Energy (PGEO). Hear from our Deputy Portfolio Manager, Jonathan Groocock, as he discusses PGEO's combination of durable zero-carbon generation assets, sustainable cashflows, strong growth prospects and modest valuations, creating a compelling investment for UEM.


Hear from our Deputy Portfolio Manager, Jonathan Groocock, as he provides a market overview and a portfolio update on UEM's performance for November.