Company Interview / Why Dawesy likes this pick & shovel stock

Key points

Geopolitical risk around the Strait of Hormuz keeping energy and broader markets on edge Structural growth opportunity in Australian data centres benefiting SKS Technologies (ASX:SKS) and related “pick-and-shovel” plays Cautious stance on crowded AI chip exposures like SK Hynix (NASDAQ: SKHY), preference for selective long-term ideas such as (NASDAQ: SPCX)Positive view on scale, synergies and global ranking from the Genesis–Vault gold merger

Adam Dawes from Shaw and Partners outlines how geopolitical tensions in the Strait of Hormuz keep local markets cautious, particularly energy names, as traders await clarity from the US. Dawes notes heightened volatility across risk assets as investors weigh potential disruptions to oil supply alongside US political developments.

On the domestic front, Dawes points to SKS Technologies (ASX:SKS) as a potential beneficiary of the structural shift towards data centres. He highlights a strong forward order book and growing demand from hyperscalers, referencing UBS research that estimates Australia’s data centre build-out at $21.5 billion and projects the sector could represent 2–3% of GDP by 2030. Dawes prefers “pick-and-shovel” style exposure to data centre builders and infrastructure providers at this stage of the cycle.

Globally, Dawes views the AI thematic as crowded, citing SK Hynix’s recent US listing and the reliance of the South Korean equity market on $Samsung and $Hynix. He considers SpaceX more attractive on a long-term basis if launch costs fall materially and sees Starlink as its key asset. On gold, Dawes assesses the merger between Genesis Minerals (ASX:GMD) and Gold Road Resources’ associated vehicle, Vault, as creating a top-tier Australian and global gold producer with meaningful synergy potential and scale benefits.