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Utilico Emerging Markets PLC on Friday said underexposure to AI investments was the main reason for underperforming its benchmark in September. The Surrey, England-based investor in infrastructure and utility sectors posted a net asset value total return of 1.3% for the month, compared with a 7.5% return for its comparator, the MSCI Emerging Markets Total Return index. UEM’s total return in the six months that ended September 30 was just under 13%, compared to nearly 19% for its benchmark. The firm noted gains in Asian market indices, ‘fuelled by the ongoing (albeit fragile) extension of the US-Chinese trade truce and continued AI optimism.’ ‘Given UEM’s focus on infrastructure and utility stocks,’ the firm explained, it has not participated fully in ‘AI euphoria’. Latin America also saw positive performance, ‘although it was overshadowed by the AI drive seen in other regions,’ UEM noted. During September, its portfolio yielded ‘mixed’ results. UEM’s top thirty holdings were unchanged except for the replacement of Rumo Logistica SA with Celsia SA, a Colombia-listed integrated utilities business. Four of UEM’s top thirty investees saw their shares fall by more than 5% in September, the firm said. This included a 16% drop for Polish courier company InPost SP ZOO, ‘due to mounting concerns about its future relationship with one of its key clients...and teething issues with the integration of Yodel into its UK business.’ Back in April, InPost agreed to buy Liverpool, England-based rival Yodel Delivery Network Ltd for £100 million. Other detractors were SUNeVision Holdings Ltd, Manila Water Co Inc and FPT Corp. UEM’s portfolio purchases totalled £16.6m in September, while realisations came to £20.3 million. Its debt exposure worsened in sterling to £21.6 million as of September 30 from £17.1 million a month earlier. On a positive note, its trading discount to net asset value narrowed to just under 11% at the end of September from almost 12% the prior month. UEM shares were down 1.4% at 250.50 pence on Friday afternoon in London, and have risen 15% in the past 12 months. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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