Investing in Italian companies with the right tools

20.9.2021

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Finance Private equity, venture capital & top stories Eurizon Pmi

The number of investors seeking investment opportunities in the real economy is growing. We explore with Eurizon tools and strategies to enhance the Italian fabric of small and medium-sized enterprises

Productivity and digitalization make it more difficult for Italian small and medium-sized enterprises (SMEs) to grow, a sector with high untapped potential that needs funds and investment to be unlocked.

Savings and small and medium-sized enterprises: two worlds destined to meet

Forty percent of Italian SMEs do not use bank financing, a lower percentage than the rest of Europe due to the lower productivity of microenterprises, according to the Cerved 2019 Report. In this regard, it notes the 76 percent share of small Italian companies that still do not sell their products online. According to the Digital Innovation Observatory in SMEs, only 15.8 percent have developed their e-commerce site or application, effectively staying out of the new consumption patterns. Private savings represent an essential source to support the real economy. The last few years have represented the culmination of two decades of a steady increase in global financial wealth. "Italy has a growing stock of financial wealth, much of it parked in current accounts. The resources are there: the time has come to channel this wealth within the productive system," comment Eurizon experts.

Eurizon's instruments on the real economy

Among the alternative investments that best combine profit and diversification needs are private capital markets (private markets), investment solutions that use instruments not traded on public markets, and private capital solutions (credit and equities) and real assets. "As Eurizon, we have decided to position ourselves 360 degrees on the real economy, providing support to local realities and offering investors viable alternatives in a market that still struggles to create returns." Other solutions include Pir alternatives, such as Eurizon PIR Italia - ELTIF and the FIAs created by Eurizon Capital Real Asset (ECRA), a company specializing in alternative investments and "private markets," among others.

Double E Highlights: ECRA and Eltif

"Investments in the real economy, in addition to strengthening the productive system, also offer attractive returns, reducing the overall volatility of the portfolio, thanks to the possibility of diversifying the investment on different market segments, such as Private debt, Private equity, Real Estate, and infrastructure," comments Silvana Chilelli, Ceo of Eurizon Capital Real Asset. ECRA provides access to various best-in-class asset managers through portfolios that offer greater resilience to market stresses through broad diversification. ECRA aims to select the best initiatives present both domestically and internationally, thanks to a wealth of relationships established over time and the relevance of the assets managed by the SGR, with no conflicts of interest in the selection of managers. Assets under management range from Italian and global private equity, private debt, and venture capital. In addition to the solutions created with ECRA, an alternative PIR managed by Eurizon's Italian Equity team was recently launched. "Eurizon PIR Italia - ELTIF, is an alternative PIR that aims to bring the savings of Italians closer to domestic companies, to grow the real economy, and simultaneously offer a return opportunity to savers," says Francesco De Astis, Head of Italian Equity at Eurizon. "The fund is mainly invested in Italian equities. At least 70 percent of the portfolio is purchased in stocks of companies other than those included in the Ftse Mib and Ftse Mid Cap indexes."

An increasingly wide and differentiated range

Eurizon's offering on the real economy includes alternative PIRs, created both through Eurizon PIR Italia - ELTIF, and through ECRA, to which are added the ITER funds, Eurizon ITER (reserved closed-end vehicle) and Eurizon ITER ELTIF (non-reserved closed-end fund), which have recently come under ECRA's perimeter and represent an alternative strategy of direct investments in the infrastructure sector that also comply with the alternative PIR discipline, allowing them to take advantage of the tax benefits provided by the legislator.