Bbgi Global Infrastructure Share Discussion Threads

[topvest] 09/2/2024 13:42

Yes, I think they are just trying to follow the herd. It will end in disaster for the bubble its creating. I have put in a VCT application today, but want to take a look at income value over the weekend. There are some wonderful bargains if you focus on oversold equities where the dividend is very well covered. BBGI is a good example. Nearly 7% dividend yield for the lowest risk alternative on the market. Some financials are super-cheap as well. On alternatives, I think investors have been scared by some big disasters, so best to stick to the quality names with long track records.

[spectoacc] 09/2/2024 12:56

Picked up a handful of BBGI in the accounts of others; still can't quite pull the trigger for myself (not helped by having a DGI9 catastrophe).

IMO these baffling markets are down to funds/asset managers selling. There's quite a few RNS's going through on some. If it's a stock they're not selling/don't hold, then happy days. If it's one where they're selling say 10% of the equity - then ouch. They don't seem to care all that much about price.

Not saying that's definitely BBGI, but has been some strong volume just recently.

[topvest] 09/2/2024 12:08

Markets are baffling me. Quality income stocks are being sold off like they are rubbish. M7 going through the roof. I don't think I have ever known such value in one end of the market and such stupidity at the other end. Unless I am missing something!

[spectoacc] 06/2/2024 12:22

Or things (the risk-free) have changed.

Other problem is Opportunity Cost - CLI, ORIT, CREI all leaping at me this morning, tho not quite enough to catch.

@topvest - absolutely, the US (or rather, the magnificent 7) are in an epic bubble. Loved the stat, which I'll now mess up, that just the increase in value in two of them (was it Meta and Amazon?) on results day last week, was more than the entire combined market cap of BP and Shell.

If that ain't a bubble, I don't know what is. BP/Shell aren't a pair of provincial UK co's.

Have you read Albert Edwards and his Ice Age (tm) thesis? Seems to posit one final hurrah - rates cut right back down again, bonds hugely outperforming - before central bankers & govnts begin to monetise the debt.

What concerns me is, the debt load is still growing faster than either GDP growth or productivity. How's it going to be paid off, how can it ever be reduced? It can grow forever, if GDP/productivity is doing well.

Apologies for OT. Still not an owner of BBGI.

[topvest] 05/2/2024 16:49

Yes, getting very over-sold. Herd like behaviour of wealth managers switching to the M7 no doubt. Alternatives have not done well for them in the last 12m - infact they have been the worst performing category other than China. Nevertheless, this gives a 6.5% yield rising with inflation on a discount for an incredibly low risk high quality portfolio. Compare that with c4.5% on gilts and an almost guaranteed capital loss on US AI stocks when the reality strikes home... I know where I would rather be invested. Actually, I'm still keeping a high short-term gilts exposure until the yield curve plays out into recession (I don't believe the consensus) and buying modest amounts of alternatives and UK equity income investment trusts for things I want to hold forever.

Has anyone ever thought that China may be where the world economy is heading? Global markets seem to be ignoring any contagion risk, the dire state of the US deficit, the still massively inverted yield curve, two wars, inflation, the fact that we are certainly overdue a recession etc. etc. the list just goes on and on! The US market is incredible - it just goes up and up and up. Beware!

[spectoacc] 05/2/2024 12:30

Thanks. Suspect the sector would be like the REITs - selective bids, mostly below NAV (CSH; CTPT, EPIC; API).

I thought the endless inst (presumably) selling would have run its course by now, but there's more Opportunity Cost than ever out there.

Some of these very cheap for very good reason, and some (eg SEIT) I hold, but for eg from watchlist:

SEIT
TENT
GSF
GRID
HEIT
TRIG
BBGI
GCP
ORIT
CLI

Most at prices I wouldn't have expected to see other than in a market crash.

God knows what they'll be if we get one.

[topvest] 31/1/2024 13:49

Just to be clear - I'm not holding for a bid. I'm more than happy to hold and collect for 10 years+. It just got me thinking that the alternatives sector is probably going to start attracting bids, as the private market value of assets is higher than publicly listed vehicles on a discount. This vehicle is not the cheapest, but it probably has the highest quality low risk assets. Pension schemes would potentially be interested in this at 150p+ as it offers a high quality cash flow for a long duration.

[spectoacc] 31/1/2024 13:20

Never been a holder, but not sure it's particularly attractive as a bid target at a premium, particularly as that wouldn't be much of a bump for shareholders (particularly early shareholders).

Rate expectations revision still has a way to run too IMO - got completely daft, eg "..Up to 6 cuts in UK in 2024".

Yield not that sparkling, considering what largely risk-free ERNS currently pays me.

Have never held BBGI, but have had eye on it as being the quality play. Most likely I'll fail to ever buy, unless it gets a bump down on eg something geopolitical.

[hindsight] 31/1/2024 12:56

Yep back to fair, as said above got too rich for me
Rolled some TN25 back into these

[topvest] 31/1/2024 12:38

I just keep buying these at the 130p level. It's just such a low risk quality asset on a 10% discount and 6% well covered dividend yield. They could well get taken out by a pension scheme at a premium, if the discount continues in my view. The dividend yield is also starting to get very attractive as short-term gilts slip well below 5%.

[williamcooper104] 27/12/2023 10:14

Also BBGI calculate their NAV using the most conservative assumptions on inflation out of HICL and INPP plus they are internally managed

[williamcooper104] 27/12/2023 10:12

Maybe but don't forget the divi rise It's a great long term hold and forget, no drama stock

[hindsight] 27/12/2023 10:09

Too rich for me now, gone from too pessimistic on rates outlook to too optimistic

[hindsight] 20/12/2023 14:09

Nothing I have seen but seemed to have a seller whenever I brought, so maybe they have stopped or finished

[williamcooper104] 20/12/2023 13:49

Not a boring stock today Anyone know why so much of a bounce relative to HICL and INPP (announced buybacks today)

[topvest] 07/12/2023 10:44

Added a few more today. With the 10-yr interest rates declining materially, then the valuation is starting to look a tailwind rather than a headwind for the December valuation. NAV must be > 150p now.

[nerja] 06/11/2023 12:44

Thanks guys done a toepoke buy, Inpp no tax but Hicl does, every little helps

[hindsight] 06/11/2023 11:29

Saw none on my trade last month

[williamcooper104] 06/11/2023 09:56

Don't think so (from memory)

[nerja] 06/11/2023 09:50

Looking at this , is stamp duty charged or not on this one TIA

[hindsight] 12/10/2023 12:49

Just brought first tranche too with some provident bond maturity, want to get further out on curve as all I see is those paying present base rates and RCFs cant afford it so when all fixes reset 5.25% will be way too high
MMs size quotes are clearly downward so will stage in

[topvest] 12/10/2023 10:43

I've taken an entry position today on BBGI. I'd not really considered it before given it is a Luxembourg vehicle. Its certainly a high quality operation though. Probably a tad early but compelling value on offer. I'm not sure interest rates will be going much higher without causing carnage in riskier assets. Will probably add more when the chart improves.

[williamcooper104] 08/10/2023 21:35

They sort of do do that They finance each project with a long term fully amortising loan - there's one asset that has a loan that expires without amortising down but it then has a long tenor interest rate swap Thus they have very little refinancing risk and each loan is non-recourse With protect financed infra the one to watch is the holding company unsecured debt - that has a bullet maturity/refi risk In BBGIs case their RCF/hold co drawings can be repaid from their near term cashflows

[nexusltd] 08/10/2023 21:24

@Williamcooper Thank you for your, as always, fulsome and informative reply. Reading the AR, the asset capital value is not straight line depreciated over concession life. My understanding is that the concessioner’s payments after operating expenses and interest are treated as income, until close to end of life, undisclosed years, and then as capital repayment, i.e. close to a brick wall depreciation profile.

Why not operate a business such as BBGI with just working capital? Elaborating; bid and if awarded contract issue a bond, linked to the asset (not the borrower), to pay for the construction with duration = concession life. Given that the concessioners are > AA rated, taxpayer underwritten, such a bond would also be highly rated, repay bondholders’ capital at the end of the concession.