View transcript
<p><strong>As with any investment, you capital may be at risk.</strong></p>
<p> </p>
<p><strong>Thomas Hodges:</strong> So Europe’s not always thought of as a high-growth region, but Europe offers an awful lot of opportunities for growth investors. If you look a bit away from the areas where everyone tends to look in Europe, we’ve got companies which can go out and exploit fragmentation, Europe is such a fragmented market, so we think Europe is far more interesting than the headlines would let you know. But it’s really a market which is best accessed via an active approach.</p>
<p> </p>
<p><strong>Lonza</strong></p>
<p>Lonza is a contract development and manufacturing organisation, in layman’s terms that a drug manufacturer. So it partners with biopharmaceutical companies, they are an outsource partner for that company which is developing the drug. What generally is expected that will happen is that by 2028 52 per cent of drugs will be outsourced and that means that we’re going to see more of these drug manufacturing volumes pushed towards the likes of a Lonza. Lonza is one of the largest drug manufacturers in general but particularly for biologics where we’re seeing an awful lot of focus be applied. And that means that Lonza can take market share over the long term.</p>
<p> </p>
<p><strong>Topicus</strong></p>
<p>So Topicus I would say is probably one of the fastest growing companies Europe. What this business is doing is consolidating a very fragmented market, and that market is vertical market software. So these are highly specialised pieces of software to the type of industry and business, and also geography that they serve. And the great thing is that there’s thousands of them, they have the opportunity to go around and consolidate these businesses. It’s knowing exactly what they want from an acquisition and it’s going out and finding them at the right price. And so what that translates into is growth upon growth upon growth.</p>
<p> </p>
<p><strong>Soitec</strong></p>
<p>Yes, so Soitec’s a little bit complicated. It manufactures a small, incredibly thin wafer which goes into a semiconductor chip in order to boost its performance, so with more chips, more powerful chips going into phones, there’s more need for Soitec’s wafers. It can improve the range of an electric vehicle by about 5 to 10 per cent, and they think that it should be able to reduce the cost of a battery by 15 to 20 per cent. The use cases are expanding incredibly significantly, we don’t think the market is quite alive to that yet, and so the valuation along with that really big growth case adds up to something which could be quite significant, we think.</p>
<p> </p>
<h3>Risk Factors</h3>
<p>The views expressed should not be considered as advice or a recommendation to buy, sell or hold a particular investment. They reflect opinion and should not be taken as statements of fact nor should any reliance be placed on them when making investment decisions.</p>
<p>This communication was produced and approved in September 2024 and has not been updated subsequently. It represents views held at the time of writing and may not reflect current thinking.</p>
<p><strong>Potential for Profit and Loss</strong> <br>All investment strategies have the potential for profit and loss, your or your clients’ capital may be at risk. Past performance is not a guide to future returns.</p>
<p>This communication contains information on investments which does not constitute independent research. Accordingly, it is not subject to the protections afforded to independent research, but is classified as advertising under Art 68 of the Financial Services Act (‘FinSA’) and Baillie Gifford and its staff may have dealt in the investments concerned.</p>
<p>All information is sourced from Baillie Gifford & Co and is current unless otherwise stated. </p>
<p>The images used in this communication are for illustrative purposes only.</p>
<p><strong>Important Information </strong></p>
<p>Baillie Gifford & Co and Baillie Gifford & Co Limited are authorised and regulated by the Financial Conduct Authority (FCA). Baillie Gifford & Co Limited is an Authorised Corporate Director of OEICs. </p>
<p>Baillie Gifford Overseas Limited provides investment management and advisory services to non-UK Professional/Institutional clients only. Baillie Gifford Overseas Limited is wholly owned by Baillie Gifford & Co. Baillie Gifford & Co and Baillie Gifford Overseas Limited are authorised and regulated by the FCA in the UK.</p>
<p>Persons resident or domiciled outside the UK should consult with their professional advisers as to whether they require any governmental or other consents in order to enable them to invest, and with their tax advisers for advice relevant to their own particular circumstances.</p>
<p><strong>Financial Intermediaries</strong></p>
<p>This communication is suitable for use of financial intermediaries. Financial intermediaries are solely responsible for any further distribution and Baillie Gifford takes no responsibility for the reliance on this document by any other person who did not receive this document directly from Baillie Gifford.</p>
