IFT - Infratil

[Left Field]

Report in Business Desk 15 Aug (Behind paywall)

One NZ is gearing up to launch a dedicated fibre business

Seems One NZ will promote its Data centres, international cables and local linkages to offer benefits to key NZ business customers.

No surprise IMO.

[Waltzing]

AI data transfers going to take a lot of pipe and it could be a case of advanced system automated to AI might need a lot of bits and bytes...

bit like the transformation from the hand controlled loom to fully automated..

[Left Field]

A look inside Infratil's CDC data centres and a talk to the CEO.....

https://www.nzherald.co.nz/business/first-look-inside-infratils-10b-ai-data-centre/DWJVAWXPT5G4RCWF4NSGBQ7DNY/

[Left Field]

ASM presentation doc FYI.

https://api.nzx.com/public/announcement/436667/attachment/425347/436667-425347.pdf

[Left Field]

Snoopy's analysis on the other Chanel rates SPK as a good dividend yield at recent SP prices..... and one of his reasons is Spark's 'more measured approach' to investments in Data centres.

Snoopy says...

".....but (IFT) investors are not wary of the cost of Infratil planning new CDC datacentres on a 'build it and they will come' basis. Huh? Don't get me wrong, I am not bagging Infratil and I hope they do well. I want to invest in datacentres. But I prefer Spark's measured approach of having the customers signed up first before the build program is rolled out."

I wondered if Snoopy's 'Build it and they will come' claim was correct...

A recent interview with IFT CEO mentioned that IFT's new data centres were built with 10 yr leases already in place.

In addition on page 32 of IFT's latest report;

" The size, tenor and quality of demand from CDC's customers support its unique approach to delivering capacity at scale and underpin the long-term visibility of CDC's contracted pipeline, extending CDC's weighted average lease expiry to over 30 years (incl. options). Contract options continue to be converted as they occur as a result of CDC's relentless focus on customers, quality and security."

If we also consider:

1.) 62% of IFT's business now in 'digital' on an international scale
2.) $1.1 billion equity raise ready to be utilized primarily in additional digital initiatives.
3.) IFT's ownership of renewable energy assets such as  Long Road Energy positions it well for 'green energy' linked to intensive AI  data needs.
4.) IFT  ownership of AI and high performance data management tools/services via Kao Data etc.
5.) IFT ownership of One NZ .

IFT seems 'well positioned' for increased international digital exposure and when the market appreciates this, there is likely to be a significant re-rating of IFT's SP.

[Left Field]

IFT SP getting some love today as it climbs above $11.00.....(approx $NZ 11.50 on the ASX at close,) possibly this news helps put a market value on IFT's  CDC Data Centre plans......Crikey the re-rating of IFT mentioned in the post above might be starting!

https://www.sharecafe.com.au/2024/09/04/blackstone-bites-into-aussie-data-centre/

"Global investment titan Blackstone has snapped up Australian data centre giant AirTrunk for a whopping $23.5 billion. The deal, which marks the largest corporate transaction in Australia this year, underscores the insatiable appetite for data centres as artificial intelligence continues to reshape the technological landscape."


And Business Desk agree's .....( behind a paywall.)

https://businessdesk.co.nz/article/markets/why-the-25-billion-airtrunk-datacentre-sale-is-a-useful-reference-for-infratil

[LoungeLizard]

IFT really on a tear - up 35c today. Is the mythical re-rating finally becoming a reality? If so, the sky's the limit.

[LaserEyeKiwi]

$12.00

[LoungeLizard]

Wow! There it is - $12. IFT continues to be the best performing stock that hardly anyone talks about.

[Left Field]

Wow! There it is - $12. IFT continues to be the best performing stock that hardly anyone talks about.

The Mythical re-rating is no longer mythical me thinks its reality time.

Huge volumes today, 2.2 mill shares traded, so it seems there is real interest, real strength......and it's likely to go higher in the days ahead.

FPH also on a tear today.....another 52 week high.... all we need is TWR to do well in tomorrows update and it will be a trifecta!

[Basil]

Congrats to holders.  Not sure I would call FPH up 0.13% on a tear but yes, a new high.  Speaking of trifecta's, I think I hit one today through my fund holdings.
IFT at 16% allocation second biggest holding for Kingfish up 5.55% today.  Hold lots of Kingfish and bought even more today.
NextDC in Australia up 8.4% held in both Barramundi's and Discovery's portfolio.  Holding lots of Barramundi and units in the Discovery fund.
Agree the data centers have plenty of room to run.

[Red Baron]

Agree the data centers have plenty of room to run.

Yes zhey do. Reinvest all profits back in ze business to make ze investment grow faster.   Keep borrowing more against ze increasing value of ze underlying investments to vurther boost growth.  Take advantage of ze 'huge tail vind of demand' for AI as ze 'next big thing'.  Keep building -like everyone else- to meet ze 'exponential demand' vor vhich Infratil vill be able to charge higher and higher prices.

Hmph! Zounds like a parallel 'industry plan' to another zector that has been of great interest to 'Stocktalk' investors of late, thinking about 'retirement'.....

RB

[LoungeLizard]

FPH also on a tear today.....another 52 week high.... all we need is TWR to do well in tomorrows update and it will be a trifecta!

Yep, great day at the office. For me it was IFT and HLG - and hopefully TWR tomorrow!

[KW]

Currently the hype around data centres reminds me of the dot com days, when internet networks where the big rage, and every telco in the world rushed out to install fibre networks everywhere.  This resulted in a massive over supply, nobody could operate at full capacity, and almost everyone went broke.  Company share prices went through the roof then promptly collapsed or went to zero as the cycle played out.

Something to bear in mind before you go all in on the data centre hype. 

[LoungeLizard]

Currently the hype around data centres reminds me of the dot com days, when internet networks where the big rage, and every telco in the world rushed out to install fibre networks everywhere.  This resulted in a massive over supply, nobody could operate at full capacity, and almost everyone went broke.  Company share prices went through the roof then promptly collapsed or went to zero as the cycle played out.

Something to bear in mind before you go all in on the data centre hype.

Who went broke? Not the infrastructure or fibre companies. The dot com bubble was built on business's with ideas but no capital, no assets and no profit and they are the one's who went broke. As for internet networks being "the big rage" - well that's a bit like saying electricity is just a passing fad

With AI on the cusp of becoming mainstream, the demand for increased data storage and processing capability is only getting started. IFT have been ahead of the curve on this and it's why their capitalisation value continues to climb strongly and the SP has nearly trebled in 5 years.

disc: My biggest holding by far.