Summary
The fund managers believe that SRG Global Ltd represents a compelling investment opportunity due to its strong fundamentals and strategic positioning in the infrastructure sector. They highlight that 80% of SRG's revenue is recurring, which provides a stable financial base. The acquisition of Diona is seen as a significant growth driver, enhancing SRG's capabilities in water and energy services. Fund managers have noted SRG's consistent margin improvement and strong cash generation, which supports ongoing dividend payments and positions the company favorably for future growth. Despite some volatility in share price, with a notable rise of 42% since the last capital raise, they maintain that SRG is still undervalued compared to its intrinsic value. The outlook remains positive, bolstered by a robust pipeline of contracts totaling $1.8 billion in FY2025, which is expected to drive further earnings growth. Overall, the fund managers express confidence in SRG's long-term growth potential and prudent management strategy.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Source: Trading View
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Commentary From The Managers
Mint Asset Management
21 July 2025
$1.68
Summary
- Mint Asset Management noted that Industrials was the best performing sector in the quarter.
- SRG Global emerged as the standout performer with a gain of 46%.
- There was no specific news from SRG Global, indicating underlying strength in the business.
- Insights from an update with the CEO revealed strong demand across the business.
- Mint Asset Management continues to hold its position in SRG Global due to these positive indicators.
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Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
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Commentary From The Managers
Mint Asset Management
21 July 2025
$1.68
Summary
- Mint Asset Management noted that Industrials was the best performing sector in the quarter.
- SRG Global emerged as the standout performer with a gain of 46%.
- There was no specific news from SRG Global, indicating underlying strength in the business.
- Insights from an update with the CEO revealed strong demand across the business.
- Mint Asset Management continues to hold its position in SRG Global due to these positive indicators.
Milford Asset Management
30 June 2025
$1.73
Summary
- SRG Global experienced a strong rally of 14.6% following $850m in contract wins.
- The company is successfully diversifying operations across various geographies and sectors.
- Milford Asset Management appreciates the management’s focus on securing multi-year contracts, which helps to mitigate the risk of near-term disappointments.
QVG Capital
30 June 2025
$1.73
Summary
- QVG Capital notes that SRG Global has contributed positively to portfolio returns this month.
- SRG Global announced $850m worth of contracts, which is significant given their revenue of approximately $1,300m.
- Speculation surrounding potential M&A activity has likely supported the share price.
- The recent acquisition of Diona, a water infrastructure maintenance business, has proven to be a great success.
Wilson Asset Management
30 June 2025
$1.73
Summary
- SRG Global is a diversified infrastructure services contractor involved in engineering, construction, and maintenance sectors.
- The company's share price increased by 15% in June, achieving a decade-high by month-end.
- SRG Global secured $850 million in new contracts with blue-chip repeat clients across various sectors, including water, energy, resources, defence, and data centres.
- This brings the total contract value for FY2025 to approximately $1.8 billion, more than double the previous year.
- The growth in contracts supports further expansion into FY2026.
- The awarded contracts demonstrate SRG Global's cross-selling capability and strong client relationships.
- Wilson Asset Management continues to hold because the company is positioned to compound earnings as investments in critical infrastructure by governments and corporates persist.
Pendal Group
30 June 2025
$1.73
Summary
- Pendal Group maintains an overweight position in SRG Global.
- SRG Global has secured $850m in contracts with repeat clients.
- Contracts span multiple sectors including water, energy, industrial and resources, health and education, defence, transport, and datacentre and commercial.
- This diversification supports strong growth potential for SRG Global.
Ryder Capital
31 Mar 2025
$1.18
Summary
- SRG fell 14.8% over the quarter after a strong performance following the capital raise for acquiring Diona.
- Since the last capital raise in August 2024, the share price has increased 42%, with a peak gain of 81%.
- Ryder Capital has taken the opportunity to realise meaningful profits by trimming exposure in SRG on value and risk management grounds.
- Position reduced from 8.2% to 4.5% by quarter-end.
- SRG remains a core holding in the portfolio.
- Company operates a high-quality, growing business in attractive sectors.
- Supported by tailwinds and consistently paying increasing fully franked dividends.
Wilson Asset Management
31 Dec 2024
$1.39
Summary
- SRG Global is an engineering-led specialist focused on delivering innovative solutions for asset, mining, and construction services.
- Recently secured $700 million in contracts with repeat clients in the water, dairy, and resource sectors.
- Share price increased to $1.385 on 31 December 2024, marking a 106.7% increase over the 2024 calendar year.
- A low-liquidity period in December 2024 amplified share price movements.
- Anticipation of expected inclusion in the ASX 300 by March 2025 has driven increased interest.
- Market expectations of upside potential to FY25 earnings guidance further supported positive share price momentum.
Ellerston Capital
30 Nov 2024
$1.31
Summary
- November saw a new decade-high share price for SRG Global (SRG AU) at $1.35, reflecting an 18% gain.
- SRG has expanded into the water sector through the acquisition of Diona, which is yielding positive results.
- Recent contract wins total $700m, with significant contributions from the new Diona business.
- Contract wins are diverse, covering Water, Dairy, Resources, Transport, and Health sectors.
- Many contracts are long-dated or recurring, enhancing the quality of SRG's revenue stream.
- Total contract wins for FY25 have reached $925m in just 5 months, surpassing FY24's total of $776m.
- SRG's guidance includes $125m EBITDA, which may appear conservative if current momentum continues.
Ryder Capital
30 Sept 2024
$1.11
Summary
- Ryder Capital continues to hold a significant position in SRG Global due to strong FY24 earnings.
- SRG Global acquired Diona, a leading services company in water security and energy transition, which is seen as a strategic move.
- The Diona acquisition is viewed as attractively priced, offering earnings accretion to SRG along with long-term contracts and recurring revenue.
- To finance this acquisition, SRG raised $111m at $0.83 per share, with Ryder Capital investing an additional $1.6m.
- Over the quarter, SRG's share price rose by 33%, following the announcement of record profits exceeding FY24 guidance.
- The results were bolstered by strong free cash generation and a record work in hand.
- The outlook for SRG remains strong, supported by industry tailwinds and improved earnings quality.
- There is potential for SRG's inclusion in the ASX 300 during the March 2025 quarter rebalance.
Monash Investors
30 Sept 2024
$1.11
Summary
- SRG Global provides maintenance and industrial services to a vast range of infrastructure assets across Australia.
- The company enjoys a revenue base that is 80% recurring in nature.
- SRG Global has consistently grown its business while improving margins in recent years.
- Monash Investors initiated a small position in 2024 at attractive valuations.
- An opportunity was taken to add to the holding via a modest capital raise in August.
- The capital raise partially funded a strategically interesting acquisition of Diona, a leading water and energy services provider.
- Shares have performed well since the capital raise, but they continue to undervalue the recurring nature of its revenue base.
- There is continued growth potential supported by significant infrastructure spending underway across Australia.
Monash Investors
31 Aug 2024
$1.07
Summary
- Monash Investors notes that SRG Group experienced an 18% rise over the month due to a strategically interesting acquisition.
- The acquisition involves Diona, which complements SRG's focus on water security and energy transition.
- The deal will be all-cash, funded through a prudent level of debt and a well-supported equity capital raise.
- Monash Investors has been invested in SRG for an extended period, recently increasing their holding at an attractive price via an institutional placement.
- SRG has shown significant improvements in its business and economic model over the past few years.
- The company is prudent in its balance sheet management and currently enjoys strong operating momentum.
- Pricing remains attractive with potential for material further upside.
Ryder Capital
31 Mar 2024
$0.83
Summary
- SRG Global reported a positive first half result with a 19% increase over the quarter.
- Strong cash generation supports the company's upgraded earnings guidance, indicating ongoing momentum in the business.
- The upgraded guidance is driven by forecasted strong cash flow for the second half of 2024 and into FY2025.
- SRG is steadily expanding its order book through multiple contract wins.
- Ryder Capital believes that SRG continues to trade below its intrinsic value, presenting opportunities for growth.
- With a strong management team and projected growth, Ryder Capital sees further upside potential.
Ryder Capital
30 Sept 2023
$0.65
Summary
- SRG Global remains the largest position in the Portfolio
- Fundamentally undervalued trading at sub 9x FY24 P/E
- Strong operational momentum supporting guidance of ~20% EBITDA growth
- Integration of the ALS Asset Care business is progressing positively
- Winning contracts under SRG's ownership
- Strong broad based order book following significant contract wins
- Large proportion of earnings secured under long-term contracts
- SRG is well positioned to deliver meaningful earnings growth
- Expecting a valuation re-rate translating into strong share price performance
Ryder Capital
31 Mar 2023
$0.75
Summary
- SRG Global is the largest position in the portfolio and exhibits a key transformation story.
- Performance was positive post-initiation in 2019, but the company faced challenges due to GCS acquisition and Covid-related disruptions in 2020.
- Ryder Capital views these challenges as temporary and considers the business materially undervalued.
- There is a clear pathway to restore earnings growth with a high-quality management team in place.
- Ryder Capital has added to its position at costs well below market value.
- The company currently has a substantial book of work in hand along with a healthy opportunity pipeline that enhances recurring revenues.
- SRG Global has announced $960m in contract wins since the start of FY23, indicating strong operational growth.
- Recent acquisition of ALS Asset Care further supports growth prospects.
- Ryder Capital anticipates continued upside driven by earnings growth and potential valuation multiple expansion.
- Index inclusion over the coming quarters is expected to positively impact the stock.
Please note: The completeness, accuracy or current status of the investments referenced are not guaranteed.
Frequently Asked Questions
Who has invested in SRG Global Ltd (ASX:SRG)?
Fund managers including Monash Investors, Ryder Capital, Mint Asset Management, QVG Capital, Pendal Group, Milford Asset Management, Wilson Asset Management and Ellerston Capital have invested in SRG Global Ltd (ASX:SRG).
Why have investment managers invested in SRG Global Ltd (ASX:SRG)?
Fund managers have invested in SRG Global Ltd due to its strong fundamentals and growth potential. The company operates in the infrastructure services sector, providing maintenance and industrial services with an impressive 80% recurring revenue base. Recent strategic moves, including the acquisition of Diona, a leading water and energy services provider, have enhanced its market position and earnings potential. Fund managers highlight SRG's consistent revenue growth, prudent management, and attractive valuations, with expectations of further upside driven by significant infrastructure spending in Australia. The company has also secured substantial contracts across various sectors, reinforcing its operational momentum and long-term growth outlook.
What happened to SRG Global Ltd (ASX:SRG)?
In recent reports, fund managers have expressed strong confidence in SRG Global Ltd, highlighting its impressive performance and significant contract wins. Mint Asset Management noted a 46% increase in share price, driven by robust demand across the business. QVG Capital emphasized the announcement of $850 million in contracts, enhancing portfolio returns and fueling speculation of further M&A, particularly following the successful acquisition of Diona. Pendal Group and Milford Asset Management echoed this sentiment, praising SRG Global's diverse operations and long-term contract strategy, while Wilson Asset Management reported a 15% rise in share price, reaching a decade-high, with total secured contracts for FY2025 now at approximately $1.8 billion. These insights collectively underscore SRG Global's strong market position and growth potential in the infrastructure services sector.