Ambitious Di Pilla sets a $50bn target for his funds management house HMC Capital

Funds management house HMC Capital is advancing on an empire spanning $50bn of assets and could become a global force as its digital infrastructure plays have already taken it offshore.

Concerns have been raised in federal parliament about security of Defence Department secrets held by Chinese-owned data centre Global Switch.

Funds management house HMC Capital is charging towards having an empire spanning $50bn of assets in coming years, with ambitions of developing into a global force as its digital infrastructure plays have already taken it offshore.

The company, led by former investment banker David Di Pilla, has stolen a march on larger rivals by forging quickly into new fields. It has made a big push in five areas – real estate, private equity, private credit, energy transition and digital infrastructure, where it will soon float a $4.2bn trust on the ASX.

“We are now on track to achieve our previously stated $20bn medium-term asset under management target in fiscal 2025,” he said. ”We are now targeting much more ambitious growth with our sights now set on growing assets under management to $50bn-plus over the next three to five years,“ he told investors at the company’s annual general meeting.

“We believe this target is highly achievable with each platform exposed to high growth megatrends in sectors with deep and broad investment opportunities,” Mr Di Pilla said.

“Each of our platforms can be scaled to at least $10bn each over the next three to five years.”

He sees the potential for significant growth beyond Australia, particularly in data centres.

The company’s rapid trajectory since it bought the ex-Masters portfolio and transformed itself into a broad-based funds house concentrating on private equity-style plays has prompted a share price surge.

Investment bankers said that Mr Di Pllla had marshalled a team that had an edge over rivals as it tapped hungry retail investors and its wealthy backers, as well as bringing in institutional partners.

“They’re all very broad and very deep verticals,” Mr Di Pilla said. “They’re all exposed to structural megatrends … we always want to invest in asset classes that we believe are growing.”

Mr Di Pilla said the company’s ability to scale up was greater if it had fundamental growth driven by a megatrend.

The data centre fund is poised to float next month and is benefiting from the big shift to cloud storage, and the HMC boss noted that AI was a step change for such assets.

He believed HMC could control the risks of moving into international markets.

“We went into the offshore market in what we believe to be a very risk controlled way,” he said, noting that it was two years in the making.

Mr Di Pilla was not concerned about the sectors he invested in running so hot. “We put a lot of analysis into everything we do,” he said.

HMC’s year-to-date performance showed that annualised pre-tax operating earnings were tracking at 70c per share, 52 per cent above the trading update in October, the company said.

Mr Di Pilla said the step up in earnings has been driven by the outperformance of its unlisted HMC Capital Partners Fund I and setting up the DigiCo REIT.

That move meant it would target about two thirds of its earnings base generated from recurring sources.

After its recent $300m equity raising and increase in the corporate credit facility to $600m, HMC had $1.9bn of liquidity and tangible assets.

Chairman Chris Saxon told the meeting, where there was a small protest vote against Mr Di Pilla’s pay package, that HMC’s move into these high-growth sectors followed years of screening potential opportunities and comprehensive due diligence.

HMC shares closed 18c higher at $12.45.