Das erste Quartal des neuen Handelsjahres 2023 ist recht turbulent verlaufen. Was hat sich in diesem Zeitraum bei den Aktien aus den Bereichen Umweltschutz und Erneuerbare Energien getan, die das Portfolio des Pictet Global Environmental Opportunities P EUR (WKN A1C3LN, ISIN LU0503631805) bestimmen? Pictet-Fondsmanager Luciano Diana hat für alle Investoren der FondsStrategie SJB Nachhaltig die Antworten und zahlreiche wertvolle Zusatzinformationen parat. Der aktuelle Marktbericht per Ende April thematisiert die FondsPerformance, die Veränderungen im Portfolio sowie den Ausblick für die Aktienmärkte des Environmental-Sektors.
Market review
Q1 was a turbulent quarter. In March, the demise of Silicon Valley Bank, which specialised in lending money to tech start-ups, sent tremors through financial markets in the US and beyond. Several other regional US lenders felt the aftershocks. Credit Suisse also wobbled, prompting a state-orchestrated takeover. The worst fears of 2008-style ructions ultimately proved unfounded, but the need for emergency measures revealed signs of financial stress, which ultimately will cause more volatility going forward. Thanks to the Fed intervention through various discount and borrowing programs, equity markets globally had a solid end to the quarter, with most of the major indices up. On the environmental theme, in March the European Commission released a set of regulatory proposals as a follow up to the EU’s Green Deal Industrial Plan, which was published in February. The proposals included more detailed elements on how to boost green industries in Europe, including: (1)The Net Zero Industry Act, (2) The Critical Raw Materials Act and (3) Reforming the EU Electricity Market. These proposals still need to go through the EU’s legislative process before becoming law.
Performance analysis
The strategy outperformed the MSCI AC World Index during the quarter. As in the previous quarter, Energy Efficiency was the strongest segment, with Infineon, ON Semiconductors, ASML, Applied Materials, Schneider, Legrand, Aptiv, Keyence and Tokyo Electron contributing positively due to a re-rating of stock multiples on the back of strong quarterly results. Dematerialized Economy also contributed positively, in particular Ansys, Cadence and Synopsys. Pollution Control detracted, with Danaher, Agilent and Eurofins experiencing a de-rating of stock multiples. Waste Management & Recycling also detracted, in particular containerboard packaging stocks such as Westrock, Stora Enso and Smurfit Kappa. Water stocks detracted, namely Xylem and American Water.
Portfolio activity – overweightings & underweightings
During the quarter, we increased our exposure to Energy Efficiency and Dematerialized Economy, while we reduced exposure to Waste Management & Recycling. In Energy Efficiency, we initiated a new position in Trane Technologies, a leading provider of building climate solutions, and we added to Schneider Electric and Eaton based on a robust outlook, while we exited our position in Signify on pricing power concerns. In Dematerialized Economy, we added to PTC and Cadence. In Waste Management & Recycling, we took profits in Republic Services, Waste Management and Waste Connections, we reduced Westrock and Smurfit Kappa and we exited our position in International Paper. In Pollution Control, we initiated a position in WSP Global, a leading environmental engineering services company. In Renewables, we reduced our position in Orsted.
Market outlook
Our portfolio companies are executing on order books that are currently at record levels, following years of COVID disruptions. Supply chain constraints are easing and companies benefit from price carry-over. Our largest segments show strong fundamentals. The current energy market dislocations are stimulating corporate investments in energy-saving technologies. ‘Green Capex’ is starting to be a multi-year secular theme driving the next wave of infrastructure investments across electricity grids, renewables, green buildings, battery storage, EVs, etc. The end-market demand for environmental remediation within the Pollution Control segment remains healthy, particularly in the US. Many of our environmental solutions, such as simulation software and Electronic Design Automation are resilient as they help industries to reduce costs. In general, our portfolio holdings have sufficient pricing power and balance sheet strength to navigate well in the current environment, characterized by high inflation and rising funding costs.
Portfolio strategy
Our strategy remains focused on investing in environmental solutions providers. We believe that exposure to environmental trends offers investors attractive risk-adjusted returns, regardless of the stage of the economic cycle. We favour solutions providers with wide economic moats, robust profitability, healthy balance sheets and business models that don’t rely on government subsidies. These companies are likely to weather a difficult economy. Our bottom-up investment process results in a concentrated global portfolio with a growth and
quality bias. Long term, the trends of population growth and rising living standards are inescapable and so is the growing strain on natural resources. Awareness of environmental issues has grown tremendously in the last few years and is now deep-seated, top of mind for an entire generation of citizens, consumers and investors.
Pictet Global Environmental Opportunities Management Team
Luciano Diana
Gabriel Micheli
Yi Du
