I'm a big believer in the power of compounding helping our portfolios grow into much larger numbers. ASX growth shares could be the best place to look for opportunities in this regard.
Australia is a great country to do business, but I think some of the best investments are ones that are tapping into international markets, which offer much more growth potential due to the larger economics.
The two investments I'll discuss are seeing success outside of Australia. One is a growth-focused exchange-traded fund (ETF), and the other is a fast-growing ASX telco share.
Let's dive into the opportunities.
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Munro Global Growth Fund (ASX: MAET)
This fund aims to invest in global growth shares. Its portfolio size is between 30 and 50 positions. While it invests with growth in mind, the fund also has a "capital preservation mindset".
There are a few different themes where Munro is finding opportunities. Its top five areas of interest are: digital media and content, high performance computing, climate, digital enterprise, and innovative health. We don't have a lot of exposure to businesses like this in Australia, so it's good to get access to themes like this elsewhere.
That investment strategy has led the fund to names like Nvidia, Microsoft, Amazon, Meta Platforms, Taiwan Semiconductor Manufacturing, Oracle, and AMD.
Over the last three years, the fund has returned an average of 19.4% per year. Since inception of the strategy in August 2016, the Munro Global Growth Fund has returned an average of 13.8% per year.
I'm calling this an ASX growth share because we can buy it on the ASX.
Tuas Ltd (ASX: TUA)
Tuas is one of the businesses I'm most excited about in my portfolio.
The company is a fast-growing Singaporean telco, which is a defensive and pleasing sector to get exposure to, in my view. Recent reports demonstrate its success. In the FY25 half-year result, Tuas reported that its active mobile services increased 23.7% to 1.16 million, which helped revenue surge 34%.
So, not only is the business defensive, but it is also growing rapidly. Plus, it has added an extra growth avenue with broadband. It only had 14,347 services as of the FY25 first half, but I think it could become a material contributor in the coming years.
If profit were growing as fast as revenue (in percentage terms), it'd be an appealing business. But, profit margins are rising, so I'm hopeful the bottom line could rise at an even faster pace. In the first half of FY24, its operating profit (EBITDA) margin was 41%, which increased to 45.2% by HY25. This allowed EBITDA to increase to 47.8% in HY25 (compared to revenue growth of 34%).
I'm bullish on the company's growth prospects within Singapore as it wins more market share based on its good value telco services for customers. I'm particularly excited by the business' potential to replicate its success in other nearby Asian countries, such as Malaysia or Indonesia. I think the ASX growth share could become much bigger if it reaches a notable market share in multiple countries.
