Polar Capital Sustainable Thematic Equity Team publish Outlooks for Smart Funds

by | Dec 22, 2021

Polar Capital Holdings plc (Polar Capital), the specialist active asset management group, has released outlooks for the two Sustainable funds: Smart Energy and Smart Mobility for 2022, managed by the Sustainable Thematic Equity Team.

Smart Mobility

“Following a successful 2021, we expect the strong growth of electric vehicles (EV) to continue. With global automobile production capacity recovering as a result of lessening supply-chain disruptions, we expect 2022 to see EV sales grow by at least 60%, which would lead to an EV market share of 12% worldwide. The global penetration will continue to be driven by Europe and China, but we have seen an acceleration in the US EV developments.

In the area of autonomous driving, 2022 may mark a major milestone with ‘level 3’ cars on public roads after authorities granted system approval for the first time in December 2021. Level 3 autonomy will conditionally allow drivers to focus on other activities such as processing emails, online shopping and web browsing. Furthermore, in 2022 we expect various fully automated robo-taxi projects worldwide to make further progress towards a public-facing commercial set-up.

Overall, we remain very constructive on the Fund given the strong fundamentals of the smart mobility sector, with the transportation sector having engaged in an unprecedented transformation towards electrification. We will continue to invest across the entire smart mobility value chain, seeking exposure to market segments like EV manufacturers and suppliers, power semiconductors, hydrogen and EV charging infrastructure, sensor and data processing technologies for automated driving, shared mobility solutions and new developments in the area of driverless mobility.”

Smart Energy

“As we start 2022, we remain constructive on the underlying themes reflected in the Polar Capital Smart Energy strategy. Driven by favourable governmental frameworks and improving economics, we believe the deployment of clean energy solutions will gain further momentum.

In terms of clean power generation, we expect another record of new installations for 2022, mainly solar, as falling raw material costs once again improve the economics. This year should also see record investment in energy storage as it strongly complements energy distribution, especially in solar electricity panels. We expect building efficiency trends to remain strong, with software-driven solutions for building management coupled with hardware improvements in HVAC (heating, ventilation and air conditioning), lighting and controls delivering strong efficiency gains and an improved user experience.

In line with the overall strong underlying electrification trend, we expect the key technology enablers stemming from power semiconductors to continue to see strong demand trends. The current tense supply situation is not likely to abate soon and will allow companies to continue to expand their top and bottom line.

As in the past, the Fund will continue to invest across the clean energy value chain, focusing on segments with strong structural growth drivers such as clean power production, smart grid and storage solutions, the build out of a green hydrogen infrastructure, power electronic components, electric vehicles, building efficiencies and the energy efficiency of big data.”

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