International Hotel Investments p.l.c. – New Bond Issue

International Hotel Investments p.l.c  (the “Issuer”) has announced the issuance of €80,000,000 3.65% unsecured bonds 2031, following approval by the Listing Authority.

The new bonds will have a nominal value of €100, will be subject to a minimum of €2,000, and will be issued at par. The interest rate of 3.65 per cent will be paid annually on 7th December, with the first interest payment date being 7th December 2022.

Full details about this Bond Issue are set out in the Prospectus dated 28th October 2021 which can be found here.

MeDirect will be accepting applications from anyone, who is interested. All applications must be received by not later than 26th November for applications made under a Placement Agreement and 30th November for all other applicants. In the event of over-subscription, the Issuer reserves the right to close the Offer Period before this date.

If you are interested in applying, please send us a Secure Mail or contact your Relationship Manager.

For further information, please call us on (+356) 2557 4400 or send an email to

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Morningstar Views: Supply Chains Snap Under Pressure

By Michael Field, CFA & David Whiston, CFA, CPA, CFE

When looking at the current shipping crisis, it’s important to know the background. Since 2015, new vessel orders in freight shipping had fallen markedly, dropping by roughly half from the first half of the last decade. This tight capacity kindled the fire we are now witnessing, with shipping demand far outstripping supply and freight rates rocketing. The match that started the fire, however, was the coronavirus pandemic, coming hot on the heels of the already disruptive U.S.-China trade war.

Semiconductor manufacturers are now running at full capacity and padding their order books for 2022, focusing only on the highest-value clients. Auto manufacturers are depleting their inventories as they wait for the requisite semiconductors to complete their production cycles. Fashion companies are still coming to grips with delayed delivery times and an increased focus on online shopping. And global shipping and logistic companies are taking full advantage of the tight capacity in freight to draw in high-value clients and beefy margins.

The market consensus forecasts normal ocean freight rates in 2022, falling almost 20% from this year’s elevated levels, with the end of 2021 commonly identified as an inflection point. While we agree with the premise here, we believe the risk is to the downside, with the likely impact of these fixes not necessarily having the desired effect until early or mid-2022; this means elevated freight rates could persist for a while longer.

The stock market as a whole has rallied hard over the last 18 months, and a quick comparison between the valuations of those stocks that were worst affected by supply chain issues and those that were not suggests the market believes the worst of the shipping crisis is over and freight rates–as well as many of the supply chain issues–should ease soon. The market is half-right.

The picture is looking brighter because delays at ports are being reduced, schedule reliability is improving, and the successful rollout of vaccination programs across the United States and Europe will soon mean further removals of pandemic-related restrictions. A pause by carriers on scrapping vessels and the addition of 5.40 million new shipping containers this year alone should also help abate elevated freight rates and ultimately get goods moving more quickly and reliably through the supply chain. However, we believe a year-end target for this is probably too optimistic. It could be sometime in the first or second quarter of 2022 before we see meaningful improvement.

This does not solve all the supply chain issues that have surfaced during the pandemic, many of which are more structural in nature. However, the pandemic should be a catalyst for change, with companies already working with shipping and logistic partners to diversify their supply chains in order to bolster against future disruptions. It may also encourage a longer-term outlook, with companies now transitioning to long-term agreements with carriers to lock in capacity and rates, all of which should help avoid a repeat of the mass disruption caused by the pandemic.

In some of the sectors we have analyzed, we see little value. This is particularly true for the shipping and logistics segment, with companies like DSV (DSV) and Kuehne + Nagle (KNIN) firmly in overvalued territory. In other areas, many of our picks are focused on stocks with pre-existing overhangs, like Hanesbrands (HBI) in fashion or Intel (INTC) in semiconductors, where we see a mismatch in the strength of the underlying business and lackluster market expectations for both stocks. In the auto segment, we see more stock ideas, with Ford (F) and General Motors (GM) in the U.S. and Volkswagen (VOW) and BMW (BMW) in Europe. As semiconductor supply issues abate, we believe smart market positioning in the electric vehicle segment will underpin these carmakers’ ability to succeed.

Key Takeaways

  • We believe the market is too bullish in expecting ocean freight rates to fall by the end of the year or even early next year; we see mid-2022 as more realistic. Shipping delays and schedule reliability will take even longer to fix, given the confluence of issues causing the current crisis.
  • Disruption in the semiconductor segment should even out somewhat in the coming year, with a new supply/demand equilibrium as hybrid work models are maintained, driving longer-term demand for technology to facilitate this. Intel is our top pick in the semiconductor segment, with many of the other names now overvalued.
  • Semiconductor supply issues in the auto segment will most likely persist well into 2022. They are already beginning to affect auto sales, with inventories dropping to record levels. In the longer term, we are positive on the auto segment and see a number of attractive stock opportunities. We believe recent supply issues will drive more robust sourcing practices of crucial parts. Ford and GM in the U.S. are our favored ways to play the segment, along with BMW and Volkswagen in Europe.
  • In fashion, we believe the global pandemic has caused a split between the most and least capable global brands, with the omnichannel approach now favored by many of the largest companies. Hanesbrands in the U.S. and Swatch (UHR) in Europe are our most attractive names in the fashion segment, both trading at significant discounts to our fair value estimates.
  • In shipping, giants like Maersk (MAERSK B) have capitalized massively on the capacity constraints caused largely by the pandemic, with higher freight rates generating outsize returns for these companies. However, valuations are less attractive now. Third-party logistics companies have also capitalized on capacity issues to attract new clients and upsell additional services amid increased border restrictions during the pandemic. Structural opportunities remain in this segment, but we believe valuations are now materially elevated.

Morningstar Disclaimers:

Since its original publication, this piece may have been edited to reflect the regulatory requirements of regions outside of the country it was originally published in.

The opinions, information, data, and analyses presented herein do not constitute investment advice; are provided as of the date written; and are subject to change without notice. Every effort has been made to ensure the accuracy of the information provided, but Morningstar makes no warranty, express or implied regarding such information. The information presented herein will be deemed to be superseded by any subsequent versions of this document. Except as otherwise required by law, Morningstar, Inc or its subsidiaries shall not be responsible for any trading decisions, damages or losses resulting from, or related to, the information, data, analyses or opinions or their use. Past performance is not a guide to future returns. The value of investments may go down as well as up and an investor may not get back the amount invested. Reference to any specific security is not a recommendation to buy or sell that security. It is important to note that investments in securities involve risk, including as a result of market and general economic conditions, and will not always be profitable. Indexes are unmanaged and not available for direct investment.

This commentary may contain certain forward-looking statements. We use words such as “expects”, “anticipates”, “believes”, “estimates”, “forecasts”, and similar expressions to identify forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results to differ materially and/or substantially from any future results, performance or achievements expressed or implied by those projected in the forward-looking statements for any reason.

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MeDirect Disclaimers:

This information has been accurately reproduced, as received from Morningstar, Inc. No information has been omitted which would render the reproduced information inaccurate or misleading. This information is being distributed by MeDirect Bank (Malta) plc to its customers. The information contained in this document is for general information purposes only and is not intended to provide legal or other professional advice nor does it commit MeDirect Bank (Malta) plc to any obligation whatsoever. The information available in this document is not intended to be a suggestion, recommendation or
solicitation to buy, hold or sell, any securities and is not guaranteed as to accuracy or completeness.

The financial instruments discussed in the document may not be suitable for all investors and investors must make their own informed decisions and seek their own advice regarding the appropriateness of investing in financial instruments or implementing strategies discussed herein.

If you invest in this product you may lose some or all of the money you invest. The value of your investment may go down as well as up. A commission or sales fee may be charged at the time of the initial purchase for an investment. Any income you get from this investment may go down as well as up. This product may be affected by changes in currency exchange rate movements thereby affecting your
investment return therefrom. Any decision to invest should always be based upon the details
contained in the Prospectus and Key Investor Information Document (KIID), which may be obtained from MeDirect Bank (Malta)


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