- The strategy
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The Maple-Brown Abbott Global Listed Infrastructure business was established in 2012 as a partnership between the founding Principals and Maple-Brown Abbott Limited.
Its genesis was a firm belief that investing in infrastructure should include a focus on delivering the key investment characteristics of infrastructure assets, which in our experience is often promised but not always delivered. We also believed that the best way to align ourselves with our investors was through a boutique ownership structure.
We see three key differentiators between our strategy and that of other infrastructure managers:
- We have a tighter definition of Infrastructure. Potential investments only come from a strictly selected “Focus List”. The stocks on the Focus List are those that we believe provide the strongest combination of inflation protection and low volatility.
- We set strict capacity limits for our strategy, to ensure that our portfolio consists of our best ideas. This also means that if the investment thesis changes then we are able to move in or out of stocks more quickly.
- We seek to align our interests with those of our investors. The founding Principals are majority owners of the Maple-Brown Abbott Global Listed Infrastructure business. Additionally, senior investment staff are expected to invest in the strategy alongside our investors.
Our investment philosophy
We are global investors
We aim to invest in securities diversified across a wide range of countries and infrastructure sectors.
We are long term investors
The investments that interest us most are often trading below our assessment of their underlying value because some development has caused the market to regard the immediate prospects as poor. With our longer-term time horizon we are able to look through such developments to the longer-term value of the infrastructure investment, and to see this as a buying opportunity. The holding period for stocks in the portfolio is expected to average around four years.
We are conservative investors
When it comes to looking at company balance sheets and the quality of reported accounting information, we seek to take a conservative and critical approach.
We are macro risk aware
Whilst we are primarily a bottom-up and valuation driven investor, we also utilise macroeconomic research as a risk mitigation tool.
Our investment approach
Our investment approach is based on deep, fundamental analysis of infrastructure assets combined with a top-down approach to managing macro risks.
We believe that if inflation protection and lower volatility are key investment objectives, then focusing on these characteristics must be central to the investment process. We consider potential investments from a strictly selected infrastructure Focus List of around 110 companies across more than 25 countries. The stocks on the Focus List are those that we determine provide the strongest combination of inflation protection and low volatility.
We then perform detailed quantitative and qualitative analysis on the stocks in the Focus List. We maintain financial models that include detailed cash flow analysis for at least 10 years. Our qualitative analysis assesses the quality of the assets, management and governance, key risks and ESG issues.
We then rank stocks on selected risk and inflation-protection criteria and on their estimated returns. The portfolio construction team builds the portfolio based on their rankings as well as considering macro and liquidity factors.
We utilise a high conviction approach to ensure that our strongest stock views are included in the portfolio. As a result, the strategy is expected to have between 25 and 35 global investments at any one time.
A dedicated, experienced, and focused team of infrastructure investors.