As an ESMA-registered benchmark for private renewable infrastructure investments, the infraGreen index accurately reflects the performance of unlisted companies in the renewable energy sector. The index recorded a 5.03% total return in Q3, driven by interest rate cuts and a lower equity risk premium, leading to higher valuations.

Among the highlights of Q3 2024:

• The infraGreen index saw an improvement in performance in Q3, with a 5.03% total return, driven primarily from higher valuations due to interest rates cuts and lower equity risk premium.

• The recent interest rate cuts in the US and Europe, coupled with expectations for a soft landing in the global economy, are driving an increase in infrastructure companies’ valuations more broadly, which is also reflected in the infraGreen index performance.

• The cash returns of the index were 10.9% year-on-year basis, reflecting the substantial dividends paid by the renewable sector in the past full year.

• The wind power sector delivered the largest contribution of 3.86% to index returns, while the solar power generation returned the residual of just 1.17%.

• Contracted revenue companies led index returns, highlighting their stable cash flows and strong investor appeal for predictable returns amid economic uncertainty.

• The top five performing companies saw an average valuation increase of 11.1% quarter-over-quarter driven by a reduction in discount rates applied in their valuations.

Read the full analysis here.

Find out more about the infraGreen index here.