NZX heavyweights Infratil, Fisher & Paykel Healthcare and a2 Milk Co have caught the attention of Australian investors, who are increasingly accounting for a bigger share of the Kiwi companies, according to Forsyth Barr research.
Australian ownership of those three companies is estimated to be on upward trajectories in Forsyth Barr's latest equity strategy update, which estimates international ownership of the local stock market.
Infant formula maker a2 Milk is the most Australian of the companies with our trans-Tasman cousins owning bout 69% of the firm’s total float, up about 7.2 percentage points in the three months to the end of May.
Infrastructure investor Infratil has climbed almost 1.9 points to 13.5% in the three-month period, having only really attracted interest from across the Tasman when it batted away an aborted takeover by Australian Super in 2019. F&P Healthcare has been steadily climbing since 2021, reaching 33.5%, up about 0.8 of a point over the period.
“Australian ownership of the New Zealand equity market as at 31 May 2025 (the latest available data) sits at 16.3%, down slightly from recent readings but remaining near all-time highs since our records began,” analyst Matthew Leach said in a note to clients.
Out of favour?
That helped make up for declining international interest further abroad, with passive flows from the US-listed MSCI NZ exchange traded fund – which Forsyth Barr uses as a proxy – continuing to post net redemptions with the units on issue down 13% over the past 12 months.
“A similar theme is evident across the wider Pacific region, with comparable patterns reflected in the iShares MSCI Pacific (ex-Japan) ETF,” Leach said.
Wall Street is back near record highs after US President Donald Trump’s Liberation day tariff regime sent global markets into a tailspin, with the S&P 500 and the tech-heavy Nasdaq Composite advancing 4.4% so far this year.
New Zealand’s benchmark S&P/NZX 50 index has lagged behind its Australian peer, falling 4% so far this year compared to the S&P/ASX 200’s 4.6% gain. ASX heavyweight Commonwealth Bank of Australia has surged almost 22% so far this year to post new records, whereas New Zealand’s F&P Healthcare has shed 3.3% in the year-to-date.
Insurer Tower was another to attract increased Australian ownership, with 13.5% held across the Tasman, up almost 1.6 percentage points over the three months. The general insurer's share register was freed up when Bain Capital sold its 20% stake.
Meanwhile, Ebos Group is down to 23% Australian ownership, shedding 3.4 percentage points, with the Hong Kong-based Zuellig family’s Sybos selling down its 18% stake to a 4.9% holding.
Not every company
KMD Brands and Gentrack have also shed Australian shareholders, with the retailer down 1.7 points at 34% while the utilities software developer shed about 1.5 percentage points to 58.4% Australian ownership.
Domestic investors holding more than 10% of a firm had already declined prior to the Ebos and Tower selldowns, with Forsyth Barr estimating they held 16% of NZX50 companies at the end of the March quarter, with local portfolio investors at 44.4%, and international investors owning about 40%.
The impact of a tightly-held share register has shown up for retailer Briscoe Group, after its rapid rise to a peak of $6.23 after it was added to the NZX50, before its slide down to $5.40 once it joined the benchmark.
Forsyth Barr analysts Paul Laxton Koraua and Rohan Koreman-Smit this week downgraded the retailer to ‘underperform’, while raising their target price 10 cents to $4.90 after Briscoe’s 45% surge on the NZX50 inclusion.
Justify this
“While Briscoe is a quality retailer with a strong long-term track record, in the absence of meaningful earnings upgrades, its current valuation appears unsustainable, leaving Briscoe vulnerable to a material de-rating,” they said in a note.
Retail investors have been selling into that rapid spike, with Iress data showing both Sharesies and ASB Securities clients have been net sellers of Briscoe so far in June.
Cash market trading has been on the rise for the NZX this year, with the volume of trades up almost 41% at 4.5 million in the five months ended May 31 from a year earlier, while the value of trading climbed 38% to $18.68 billion.
Forsyth Barr’s Leach said in a note the year-to-date growth was showing good momentum and crept above the long-term average, with the average daily volume for the large cap stocks at a six-year high.