The S&P/ASX 300 Index (ASX: XKO) has had a solid 12 months, rising by 9% plus dividend income. However, I'd back only some ASX 300 shares to have another good year after such a strong 2024.
I expect 2025 to be more volatile than 2024, which could open more opportunities for investors. In my view, the companies that could outperform in 2025 are the ones that deliver operational and revenue growth and (probably) profit margin growth.
Australia may see an interest rate cut (or more) this year, depending on how the Reserve Bank of Australia (RBA) board members interpret the financial data they see in the coming weeks and months. This could be a useful positive for some businesses.
Here are two ASX 300 shares that I think are primed to experience a good year in 2025 and beyond.
REA Group Ltd (ASX: REA)
REA Group is one of the most impressive growth shares on the ASX, in my opinion. The company owns realestate.com.au, which receives an average of 132.4 million monthly visits — four times more than the nearest competitor. That's a strong market position.
The company's service appears essential for the property-selling process in Australia to reach the most potential buyers. This helps attract the most property sellers, delivering more listings (and revenue) for REA Group and draws in more buyers. It's a very positive loop, in my eyes.
With the company's digital infrastructure already built, additional revenue helps the company's profit grow faster than revenue. In the FY25 first quarter, revenue rose 21%, and operating profit (EBITDA) increased 23% — this demonstrates operating leverage. In October, national buy listings were up 14% year over year, which I think bodes well for the rest of FY25.
I'm also excited by the company's exposure to India, which is digitalising and has a population of more than 1.4 billion. In the coming years, the ASX 300 share's Indian division could become a significant contribution to earnings. In the first quarter of FY25, REA Group's Indian revenue soared 42%.
Ongoing growth could send the REA Group share price higher, while an interest rate cut could boost both the Australian property market.
Temple & Webster Group Ltd (ASX: TPW)
This e-commerce company has a lot of growth potential, in my view.
It sells more than 200,000 homewares and furniture products through its website, many of which are sent directly by suppliers. This means it's fairly capital-light for several reasons, including the fact that it doesn't need to hold that inventory itself.
The ASX 300 share is benefiting from Aussies' ongoing adoption of online shopping and is also putting itself more in the minds of shoppers. In FY24, orders from both repeat (up 232,000) and new customers (up 163,000) grew strongly, helping overall revenue grow 26% to $498 million.
With how quickly this company is growing, I don't think it will be too long before it achieves $1 billion of annual revenue. FY25 revenue to 11 August grew by 26%.
Temple & Webster says its core customer proposition improves as it grows, including the breadth and depth of its range, pricing, data and personalisation, content, service, and delivery experience. It becomes an even better business as it grows.
The ASX 300 share is using generative AI to power multiple internal and customer-facing solutions. This has boosted its conversion rate and cost base.
I expect the company's FY25 revenue growth to remain pleasingly double-digit. An RBA rate cut could help boost demand for its products.
