Steady Growth for HgT Driven by Digitalization Trends

Edison Investment Research has released a detailed report on HgT, focusing on its robust financial performance in 2024. The portfolio, primarily consisting of IT software and services firms catering to SMEs, has capitalized on the increasing shift towards digitalization. This trend has translated into a 19% revenue surge and a 23% EBITDA growth among the top 20 holdings, highlighting strong operational metrics with an average 34% EBITDA margin.

Stable valuation multiples and increased portfolio debt, driven by refinancing activities, have contributed to a 10.4% NAV total return for the fiscal year. Hg, the manager of HgT, emphasizes the strategic incorporation of GenAI technology across its operations, hinting at a potential uplift in financial performance in the coming years. Despite these positive indicators, HgT shares currently trade at a 9% discount to NAV, presenting a notable opportunity in the market.