NZ sharemarket up 0.2%, Infratil hits all-time high

Utilities investor Infratil hit an all-time high and headed for the MSCI Global index, driving the New Zealand sharemarket to a small gain.

Thursday, October 24th 2024, 6:30PM

by BusinessDesk

The S&P/NZX 50 Index again traded strongly in the afternoon and closed at 12,814.07, up 26.47 points or 0.21%, after reaching an intraday low of 12,708.34 and high of 12,873.86.

Volumes continued to increase, with 55.25 million share transactions worth $222.48m. Infratil rose 32c or 2.52% to a record $13.02 on trade worth $27.79m as passive investment funds bought shares in anticipation of the MSCI index changes next month.

Infratil has become the third biggest local stock on capitalisation with $12.58 billion, behind Fisher and Paykel Healthcare and Meridian Energy but ahead of Auckland International Airport with $12.19b.

'Index changes'

Matt Goodson, managing director of Salt Funds Management, said there was MSCI-type buying “as we get well into the pricing period for the index changes".

"The pricing for Spark is relative to the next smallest stock in the index, Mercury Energy, and Spark is far too low.

“It’s highly likely that Infratil will replace Spark in the global index which attracts more buying as the passive funds get larger,” Goodson said.

Spark was down 7c or 2.31% to $2.96, and Mercury decreased 16.5c or 2.41% to $6.695.

Infratil also benefitted from data centre action in Australia, with HMC Capital buying Global Switch in Sydney for A$1.937b (NZ$2.1b). HMC is establishing a global digital infrastructure platform.

Goodson said the Chinese-owned Global Switch was bought at 22 times ebitda – quite a bullish price, and this will reflect on the valuation of Infratil’s CDC datacentres.

Scales Corp was unchanged at $3.84 after the exit of a majority shareholder, China Resources Ng Fung, which sold its 15% stake at $3.52 a share.

Goodson said the potential sale of the shareholding was an overhang for the stock and it’s good that the 21 million-odd shares have gone around the institutional investors.

In the United States, investors continued to fret about the rising bond yields – the US 10 Year Treasury Note yield was at 4.23% - and higher-for-longer interest rates.

The Dow Jones Industrial Average had its biggest single-day decline since early September after falling 410 points or 0.96% to 42,514.95. The S&P 500 was down 0.92% to 5,797.42 points, and Nasdaq Composite fell 1.6% to 18,2767.65.

Other stocks

At home, Skellerup Holdings increased 13c or 2.78% to $4.81 after telling shareholders at the annual meeting that the 2025 financial year has started solidly with first quarter earnings up more than 20%, compared to a weak previous period.

The industrial division continued to perform well, and the agri division reverted to a more normal seasonal pattern, with stronger sales of dairy rubberware in international markets. Lower footwear sales in NZ have partially eroded the improvement.

Skellerup is forecasting full-year net profit of $52m-$57m, up from $46.9m in the previous year.

ANZ Bank was up 70c or 2.03% to $35.20; Ryman Healthcare increased 12c or 2.46% to $5; Tourism Holdings gained 7c or 3.33% to $2.17; The Warehouse added 4c or 3.77% to $1.10; and Michael Hill collected 3c or 5.26% to 60c.

Comvita was up 3c or 2.61% to $1.18; Scott Technology gained 4c or 2.16% to $1.89; Burger Fuel collected 2c or 6.9% to 31c; and Promisia Healthcare increased 3c or 8% to 40.5c.

Fletcher Building declined 7c or 2.2% to $3.12; Vulcan Steel fell 35c or 4.05% to $8.30; Vista Group decreased 6c or 1.98% to $2.97; and TradeWindow eased 2c or 7.14% to 26c.

Being AI shed 3c or 5.77% to 49c; Smartpay declined 3c or 4.11% to 70c; Kiwi Property was down 2c or 2.05% to 95.5c; Heartland Group decreased 2c or 1.92% to $1.02.

In the energy sector, Manawa was down 10c or 1.81% to $5.41, and Genesis was up 4c or 1.94% to $2.10.

Channel Infrastructure, down 2c to $1.90, released a long-term vision for an energy precinct at its Marsden Point site with 120ha of unutilised land. The precinct can include lower-carbon fuel manufacturing and a range of electricity firming and storage.

Pole monitoring company ikeGPS was up 3c or 5.26% to 60c after reporting a 34% rise in annual subscription revenue to $13.2m and total recognised revenue of $12.2m, up 16%, for the first half of the 2025 financial year.

Ike said it closed a record $33m total contracts over 415 deals in that period. Since the launch of the new PoleForeman product, the total contract value has exceeded $12.5m for mostly tier-1 electric utilities in the United States.

Cooks Coffee gained 2.5c or 9.62% to 28.5c after one of its Esquires franchises in Caerphilly, Wales, was named Best Ethical Coffee Enterprise.

Tags: Market Close