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Why the Infratil (ASX:IFT) share price is on watch today

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The Infratil Ltd (ASX: IFT) share price is one to watch this morning after the company’s latest investor day updates.

What does Infratil do?

Infratil is a New Zealand-based infrastructure group that has investments in a number of industries including data centres, airports and renewable energy.

The ASX-listed entity boasts a $3.7 billion market capitalisation and is a majority owner of Kiwi renewables group, Tilt Renewables Ltd (ASX: TLT).

Why is the Infratil share price on watch?

Infratil provided its latest update in its 2020 Auckland Investor Day presentation with some juicy information for investors.

Its been a tough year in 2020 for asset owners and investors like Infratil. The Infratil share price has managed to edge 2.4% higher this year, despite the many challenges.

The group’s CDC Data Centres business has had to adapt to changing coronavirus restrictions but achieved earnings before interest, tax, depreciation and amortisation (EBITDA) growth of 50% from FY19 to FY20.

The CDC business is continuing to explore expansion opportunities in New Zealand with the construction of two 10 megawatt data centres in Auckland.

There is also a concerted push to grow its National Critical Infrastructure client base and secure additional land for further growth.

If the success of data centre rival NextDC Ltd (ASX: NXT) is anything to go by, there could be some serious growth in store for Infratil in FY21.

The Infratil share price will be worth watching as investors take in the latest updates from across Infratil’s portfolio. In its Vodafone business, Infratil is forecasting an EBITDA impact of $60 million to $75 million in FY21.

That comes as COVID-19 has hit roaming, prepaid and retail revenue despite opportunities for rapid change and more cloud-based products.

Infratil sees 5G leadership as the key to future margin growth as it looks to capitalise on shifting dynamics in the New Zealand mobile industry.

Foolish takeaway

Today’s update provides investors with some food for thought heading towards the end of the year.

There are growth opportunities on offer for both its CDC Data Centres and Vodafone businesses, let alone in the renewables space with Tilt.

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Motley Fool contributor Ken Hall has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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