Our Key Investment Themes for 2019
Industry 4.0, also known as the fourth industrial revolution, is a name given to the next generation of industrial automation, where computers and machines communicate with each other to make smart factories a reality. It encompasses a variety of technologies and platforms including automation systems that move and manipulate physical objects, the Internet of Things that measures performance, cloud computing enabling the evaluation of performance data, cognitive computing that then makes decisions from this data, and consulting services allowing ultimate integration of these enhancements.
This is part of the digital transformation happening across multiple industries, and moving forward will be crucial for businesses, both to serve customers better as well as to cut costs, allowing them to respond to the threat of competitive disruption from new entrants.
We see multiple beneficiaries from this secular growth theme, including:
- Automation players – although some parts of manufacturing are highly automated already, such as car manufacturing, there are still high growth opportunities in areas such as warehouse automation and ‘cobots’ (smaller robots that can work safely alongside humans).
- Cloud providers – these will allow the connection of billions of new devices, the harvesting of large amounts of data and the cognitive computing capabilities that will allow meaningful decisions to be taken automatically from these large data sets.
- Semiconductor players – this is not just given the large amount of computing resource likely to be demanded by the cloud providers, but also the expectation of significant semiconductor content, both processing and memory, likely to be needs in a lot of smart devices.
- Software providers – many major software providers are critical in providing the software necessary to make these digital transformation.
If you would like to discuss any of these investment ideas in more detail, please do contact one of our Investment Managers.
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