EDHEC Infra Days 2023, Day 2

DAY 2 – infraMetrics Day

The second day of the EDHEC Infra Days Conference – infraMetrics Day. It will be dedicated to our data solutions, applications drawn from the Institute’s research. Here again, interaction with the infrastructure investing community will be a core part of the seven workshops devoted to use cases for the financial and extra-financial infrastructure data available on the infraMetrics platform.

Workshop 1

Indices and Benchmarks

As the asset class has grown, it has become essential for direct investors, GPs and LPs to understand the dynamics of the market for unlisted infrastructure. Are valuations going up or down? Most investors are aware of where the market was 12 to 18 months ago, but often lack a contemporaneous view that would give them a forward-looking view of their investment case for infrastructure. Will infrastructure be replaced by bonds now that yields are durably higher? These questions and many more cannot be answered without representative market indices and benchmarks that capture market dynamics. Meanwhile, long term strategy benchmarks that look beyond the rate cycle can also be built for investors who want to hold infrastructure investments in perpetuity or to maturity. This workshop will present the indices and benchmark product of the infraMetrics platform and include use cases including:

> Capturing market dynamics with ESMA-regulated indices
> Customised portfolio and strategy benchmarks using TICCS
> Long-term Strategy Indices: investing across the cycle

Speakers:

• Frederic Blanc-Brude, Director, EDHEC Infra & Private Assets
• Abhishek Gupta, Associate Director – Solutions, EDHEC Infra & Private Assets
• Roundtable: use cases and industry applications of infraMetrics indices and benchmarks

Workshop 2

Valuation Tools for Infrastructure Equity Investments

As infrastructure becomes a larger and more omnipresent asset class, the requirement to have good data for frequent valuations increases all the time. Whether it is to transact in the secondary fund market, value pension rights or buyouts in DB funds and member investment choices in DC funds, for prudential and fiduciary reasons, the accurate and mark to market valuation of infrastructure equity investments is increasingly sensitive. The valuation tools of the infraMetrics platform allow building valuation metrics using the market method or the income method by granular segment and to customise them by asset-level risk factor exposures like leverage, size or profits and country. These valuation metrics are computed using large samples and a representative selection of assets, allowing users to access robust, yet granular data to build their own comps or benchmark acquisition or exit values. This workshop will present the unlisted infrastructure equity valuation tools of the infraMetrics platform including the following topics:

> What factors predict the market price of infrastructure companies

> Customising valuations: granular yet robust comparables

> Benchmarking cash flow forecasts with infraMetrics

Speaker:

• Abhishek Gupta, Associate Director – Solutions, EDHEC Infra & Private Assets
• Roundtable: use cases and industry applications of infraMetrics valuation tools

Workshop 3

infraMetrics for Debt Investors

Infrastructure debt has become a very attractive asset class and the opportunity for investors to get a different kind of exposure to infrastructure. However, the opacity of origination practices and the virtual absence of secondaries create valuation challenges for investors. This workshop will present the private debt indices, and debt valuation analytics product of the infraMetrics platform and focus on the following use cases.

> The perils of using the wrong inputs to value private infrastructure debt

> Credit spread dynamics: from patchy data to robust estimates of the market

> Measuring the performance of the asset class against IG corporate bonds

Speaker:

• Riazul Islam, Senior Researcher in Finance, EDHEC Infra & Private Assets
• Roundtable: use cases and industry applications of infraMetrics credit spread proxying and benchmarking tools

Workshop 4  

Climate Impact and Risk Data in infraMetrics

The climate and impacts and risks of infrastructure assets are a key point of focus but investors often lack the full picture of their level of impact or exposure to climate risks. While GPs or LPs may have carbon emission estimates for their own assets, they are not necessarily the result of a consistent model and cannot be compared to an industry average to understand the extent of the transition risk exposure. Likewise, physical risk estimates are often simplified to a ‘point on a map’ estimation and do not take into account the granularity of the terrain or the type of damage that different hazards can cause to an asset. Finally, climate data about today’s transition and physical risks are not very useful without a forward-looking view and a forward-looking value of these risks. This workshop will present the climate impact and risk metrics of the infraMetrics platform, including:

> The importance of improving data quality with emission models
> Benchmarking the climate impacts and risks of portfolios and strategies
> Building climate impact and risk proxies (Comps) for individual assets

Speaker:

Darwin Marcelo, Project Director, EDHEC Infra & Private Assets

Roundtable: use cases and industry applications of infraMetrics climate data

Workshop 5

TCFD Reporting and Beyond – A Customised Analysis of the Climate Risk of an Infrastructure Portfolio

Investors all need to report for TCFD by 2025 at the latest, but they seldom feel comfortable with the estimates of climate risk and impact that they have access to, including scenario-based valuations of infrastructure assets and benchmarks of their exposures to climate risks. With data from the investor’s portfolio about risk profile and the location of each asset, infraMetrics can be used to produce a dedicated report that covers the key metrics needed for TCFD at the asset, fund and portfolio levels. This information also allows investors to begin to manage the risks created by climate change for infrastructure investors, including the possibility of being unknowingly concentrated in highly exposed assets in some scenarios. This workshop will present the infraMetrics climate impact and risk estimation service, including:

> Service output and inputs from the investor
> Asset-level estimates of climate risk at the 2050 horizon
> Fund and portfolio level climate risk estimates and benchmarks

Speakers:

• Frederic Blanc-Brude, Director, EDHEC Infra & Private Assets
• Darwin Marcelo, Project Director, EDHEC Infra & Private Assets
• Roundtable: use cases and industry applications of infraMetrics climate data estimation service

Workshop 6

Measuring Social Impacts and Risks for Infrastructure Investments