It's also worth noting that to date the majority of CDC's customers and revenues seem to come from clients that aren't directly in the AI / LLM space where a lot of the hype is circling around. The first mention of AI relating to CDC's slide deck was in the 2023 investor day, and then FY24 results presentation - I don't blame them for riding the wave, I'm sure it helps with valuations, lending and capital raisings.
Based on past investor day presentations the key clients for CDC are:
-Government
-Defence
-Hyperscale
-National Critical Infrastructure
-Commercial Customers
In every investor day presentation from 2019-2024 there was mention to 'continue to grow and diversify our National Critical Infrastructure & Commercial client base', the only time 'Hyperscale' appeared again was most recently in 2024. Whilst they don't give a breakdown or more specific details on clients or revenue groups (which they've flagged they can't in the past due to security reasons e.g. defence, government), I think it's fair to assume most the revenue likely comes from 'boring' customer segments. Saying that regardless of what happens in the AI space, I think cloud adoption, migration and digitization are very strong tailwinds for data centre businesses for the next decade or two at least, to me CDC cashing in on AI in some way is just a bonus on top.
Since I've followed and owned Infratil it has always traded at a discount to the NAV on the ASX, however right now the gap is the largest I have seen it. I've found its natural for companies that hold a large amount of private assets to consistently trade at discounts - another example is Bailador Technology Investments (ASX:BTI), investors seem reluctant to agree with 'independent' valuations that are put on assets at times and therefore NAV, especially when the reporting on the various investments is limited or opaque as they aren't held to the same standard as the listed parent company might be.
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