En disruptiv verden full av muligheter

A couple of days ago I woke up after the night took me to the library of the future. All the books were re-classified after principles from year 2020. The first thing I noticed was that the travel guides were on the same shelf as the fantasy literature. But it was more. A lot more. Political books grouped with science fiction, books on business and economics grouped with spiritualism and books on climate and environment together with books on religion. I turned around facing the opposite wall. Journalism was grouped under political activism, books on investing in the stock market were in the entertainment section and science together with fiction. Powerful forces had reclassified the books. But it was all just a nightmare. Or?

A lesson learned from 2020 is that rapid changes can occur fast. And they rarely come alone. So it is with humble strokes that I draw little lines describing directions of change, of disruptions, for the coming years. But I have one advantage. This is my job.

Every day I look for investment opportunities that follow from changes in technology, regulations, and consumer behavior within the five investment categories:

(1) Connectivity

(2) Urban mobility

(3) Machine revolution

(4) Demographics

(5) The green economy

2020 – the year when Covid-19 reinforced, changed, destroyed, and created a wide range of business models.

But let us start with Covid-19. For those of us who survived the rave parties of the 90s it is hard to have life put on hold because of a virus named after Corona, a low-alcohol beer brewed on corn. So what happened within my five investment categories?

Covid-19 reinforced, changed, destroyed, and created a wide range of business models. Within connectivity the changes in e-commerce, streaming of audio and video, videoconferencing after Covid-19 are substantial and lasting.

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So how does 2021 look, through my eyes?

2020 was the year of the large tech companies. Apple, Google, Facebook, Amazon and maybe Tesla. There will not be a re-run. This year we will stay away from these. At least until we know what will happen on the regulatory side. There is a sense of “discomfort” in the “big-tech” culture. All the years we have believed we have used their services, have they actually been using us?

E-commerce companies (Amazon, MercadoLibre, Sea, Alibaba) will continue to increase their market shares, and maybe they will start to attack the banks account-hegemony?

In 2021 we will see estimates towards 2030 for sale of electric cars increase significantly. Hydrogen will have pockets of breakthroughs. Towards autumn 2021 we expect to see American, European and Japanese companies' reshoring aided by automation and robotization. The wealthy part of the world will to a greater extent focus on clean foods. Genetic research will have a breakthrough with a record number of studies completed within the next two years.

Now that I look into 2021 with my disruptive analytical eyes I see even bigger disruptive opportunities. A green world, as a result of regulations and changes in consumer behaviour. It will happen on all continents. And in many ways, it is about the heart and blood of society – its infrastructure.

2021 marks the beginning of a wave of investments into electrification (Siemens, Schneider Electric, Rexel, Atkore, Alfen), offshore wind (Gamesas, Vestas), solar power (First Solar, Sunrun), hydrogen (Iwantani, Bloom, Hydrogenpro, Xebec), power cables (NKT, Nexans, Prysmian), construction of offshore wind farms (Offshore Heavy transport, Cadeler), smart grid (Itron, Landis, Badger), storage (Wärtsilä, Enphase), energy efficiency (Covestro, Hunstman, Cornerstone, Barratt), circular economy (Veolia, Carbios, Renewi, Biffa, Re:newcell), carbon capture (Geo-Loop), water purification (Energy recovery).

Maybe even old Alstom who manufactures trains will experience a push by multiannual subsidies within green and urban mobility. Old “boring” companies that seize a disruptive opportunity are often good investments. In 2021 I believe there will be many of them. Cash flow, value and debt ratio will again be used with respect. They are financial tools that will return. Maybe like a boomerang?

I am an optimist. On March 28th 2021 we will again adjust to daylight savings time. At that point I believe we have gotten so far with vaccinations - that we are so close to a victory - that we just want to set the clock one hour forward. Not six months like in 2020.

Thank you for your time – I will see you in the future.