More than half of Taiwanese investors pay attention to new and old energy topics!Schroders: The value of investment in energy transition emerges

Affected by the Russia-Ukraine war, global energy prices have restarted the bull market. The energy transition fund, which was originally favored by investors during the epidemic, has been affected by geopolitical risks, inflation, etc., but the replacement of old and new energy sources has replaced each other. From Schroders Global According to a survey conducted by the National People’s Congress of Investors, nearly 60% of Taiwanese investors prefer sustainable funds, and more than half prefer energy funds. Schroders believes that new and old energy themes will still be the focus of investors’ attention. It is expected that the global economy will gradually return to normalization in the future, and new energy will once again take over the performance.

According to the Schroders Global Investor Survey, the topics that Taiwanese investors are most interested in are technology and sustainable investment, which both ranked first at 59%, followed by electric vehicles and energy-related investments at 55%. If further asked about sustainability, Among them, 59% of Taiwanese investors prefer low-carbon companies or companies that make positive contributions to society.

Chen Guanjun, vice president of the marketing planning department of Schroder Investment Bank, analyzed that past surveys clearly show that Taiwanese investors regard return rate as the main investment purpose of sustainable investment. However, with the changes in the post-epidemic environment, Taiwanese investors are increasingly able to We recognize the core value of sustainable investment, which is to use the power of investment to promote the mutual benefit of enterprises, the environment and society, and believe that positive enterprises can bring stable and long-term returns.

Mark Lacey, Schroders Group’s top theme equities and global energy executive, said that the inflation and energy shortages caused by the war in 2022 are the main reasons for the resurgence of old energy. From 2023 to 2024, it will be the massive demand brought by China and India, which will promote the resurgence of old energy. Oil prices are rising, and it is expected that market demand will begin to decrease after the second quarter of 2024, and OPEC will increase supply, which will suppress the growth of the old energy market.

Looking to the long term, Mark Lacey pointed out that with the transformation of industrial models, many oil and gas companies have currently shifted capital to low-carbon solutions. However, in an irreversible trend, the outstanding performance of traditional energy can only be summarized as “a special period” “Opportunistic wealth”, new energy is the king of long-term trend wealth, echoing the core concept of Taiwanese investors who expect fund managers to avoid investing in companies with high carbon emissions.

Secondly, investors are still worried about the headwinds encountered by the energy transformation industry in the past two years. Mark Lacey explained that the poor performance of the energy transformation industry in the past was mainly due to two reasons. First, the interest rate was too high and the tightened financial environment put financial pressure on related companies. Second, some sub-industries such as solar equipment, hydrogen energy, and wind power Weaknesses such as power generation have dragged down the overall industry performance.

After more than two years of adjustments, we can see that there are signs of improvement in revenue and evaluation in 2024, even in some sub-industries, such as Electric Equipment and Batteries and Energy. Storage)’s evaluation mask attractiveness and the expected future return rate are quite high. It is recommended that investors can take advantage of the situation and start planning.

Finally, Mark Lacey believes that the energy transformation industry is both numerous and rich. Although it has encountered headwinds in recent years, the secondary industries all include the concepts of innovative technology and paradigm shift, and there are many future stars hidden in them. Investors should look at the long-term trend. For example , the wind power market is still very promising.

According to statistics, it is expected that the power supply market share will continue to grow from the current 5% to 20% in 2050, and the power generation capacity will be five times that of the present. For example, the leading wind power company “Vetas” from Denmark is a collection of wind turbine design , a complete enterprise of manufacturing, sales, installation and service. As the global wind power market expands, Vetas’ power generation capacity and profits continue to grow.

Overall, Mark Lacey believes that the energy transformation industry has reached an investment opportunity. The long-term investment, income and cash flow growth of the entire industry can now be said to be increasingly clear and positive. Although it is still in the short term, There is market disruption. and various risks, but a thematically focused layout is recommended.

(First picture source: Schroeder)