[PIANO MUSIC] We see a lot of demand for infrastructure investment in both developed and emerging markets. In a place like the US, so much of the opportunity is about replacing aging infrastructure with cleaner and more modern alternatives. 

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Infrastructure companies are directly benefiting from most of the megatrends, trends like urbanization, shifts in global economic power, changing demographics, and responses to climate change and resource scarcity. The exciting thing about listed infrastructure companies is that their business models are incredibly defensive. Yet, the growth opportunities are massive. Not all infrastructure businesses are created the same, however. There are businesses like construction companies or solar panel manufacturers that benefit from the same top-line trends but don't necessarily offer the same profit or margin stability. 

The private infrastructure market is highly efficient. There are tons of resources, lots of time that goes into executing a private transaction. The result is it's very difficult to buy a good asset in the private markets at a discount to fair value. In the listed infrastructure space, however, we find that the markets are less efficient. Often, we find, public equity markets overreact to newsflow around political or regulatory risk, operational challenges, or natural disasters. We, as listed infrastructure investors, then have an opportunity to profit from these mispricings. 

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Listed infrastructure represents a unique opportunity for long-term investors to allocate capital at the intersection of social, environmental, and economic progress. Infrastructure companies need to balance environmental objectives, like decarbonization, with social goals, customer affordability and reliability, maintaining jobs. As active long-term investors, we're looking for high-quality infrastructure businesses, whose sustainability credentials aren't yet reflected in market valuations. 

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Listed infrastructure is a great way to diversify away from other equity sectors during periods of rising inflation. This is because the business models of infrastructure companies typically have explicit, contractual, or regulated links to inflation. A toll road operator, for example, can often increase tolls every year in line with inflation. In a regulated business model, many of those costs are passed directly to customers. All of this means listed infrastructure companies should prove more resilient during periods of rising inflation. 

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