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Feb 03, 2020

Cargotec targets retail investors as Finland launches new equity savings account

Manufacturer invests in digital IR, including new podcast series

At the start of the year, Finland introduced a new equity savings account, making it more tax-efficient for retail investors to buy and sell shares. 

One company looking to take advantage of the change is Cargotec. The Finnish company, which manufactures equipment for ports, has doubled down on its digital IR activities to raise its profile among the country’s mom-and-pop investors. 

‘I think this will encourage private investors to invest directly in stocks instead of investing in funds,’ says Hanna-Maria Heikkinen, vice president of IR at the company.

Under the new rules, members of the public can place up to €50,000 ($55,000) in the new account and invest it in the shares of domestic or foreign companies. They will pay tax only when they withdraw cash from the account. 

The scheme is similar to tax-efficient savings accounts that operate in other countries. For example, in 2012 Sweden launched its ISK account, which charges no capital gains tax. One estimate has put the number of Swedes using this product at 2 mn.

Anticipating a surge of new retail investment in Finnish companies, Cargotec has developed its IR activities on a number of fronts. A major change has been the launch of a new podcast, which comes out around results announcements. 

‘There’s lots of competition for podcasts and other types of content, so typically we have guests on to make it a bit more interesting,’ says Heikkinen. ‘For instance, we had one of our analysts discussing how he was preparing himself for the results season.

‘We also spoke with an individual – @Zijoittaja on Twitter – who tweets very actively during the annual general meeting and he shared his views on AGM season. These are podcasts so we try to be more relaxed than we are with the normal results presentations.’

Another informal channel used by the company is its IR blog. The posts typically focus on frequently asked questions about the company and give retail investors an insight into what institutional investors are thinking about, says Heikkinen.

She recently penned a blog on why her New Year’s resolution ‘is to be even more proactive about sustainability’, while IR colleague Aki Vesikallio has written about his ‘4+1 tips for digesting Cargotec as an investment case’.

Alongside digital output, Heikkinen says another part of her retail IR strategy is to up engagement with Finland’s financial blogger community. ‘I think these bloggers are getting more and more power and having a greater impact on share prices,’ she says.

‘There are also lots of active groups on Facebook – there’s lots of discussion there and certain opinion leaders. Our role is to try to impact those opinion leaders.’

For Heikkinen, the traditional sources of financial information – media outlets and the sell side – have become less influential.

‘As a result of Mifid II, analysts are not willing to comment on their recommendations in the media, which means the work of the financial media may be more difficult,’ she explains.

‘And, at least in Finland, there are also fewer and fewer reporters. Content creation is clearly more fragmented. So people who invest are looking for information from different sources.’