Barclays analysts have argued that the economic benefits of addressing the water crisis are “underappreciated”, presenting “compelling opportunities” in the sector.
Digital solutions to address water quality and waste issues present one of five investment opportunities in the sector, the bank said in a note, alongside better irrigation, recycling, desalination and atmospheric generation.
“Over time, we see the combination of these technologies supporting a structural long-term shift towards more circular business practices that recognise and recapture the full value of water,” analysts said.
“Cost will be the most significant barrier to adoption across all five investment areas.
“However, as water becomes scarcer, the payoff for investing in these solutions will likely become clearer.”
Barclays highlighted the likes of Ecolab Inc (NYSE:ECL), Core & Main Inc and Aecom as those exposed to diversified portfolios within the sector.
Rockwell Automation Inc (NYSE:ROK), Roper Technologies Inc (NASDAQ:ROP), Hubbell Inc (NYSE:HUBB) and Ingersoll Rand Inc (NYSE:IR) were identified as those exposed to digital water technologies, while Pentair PLC (NYSE:PNR) and DuPont de Nemours Inc (NYSE:DD, ETR:6D81) were picked out for treatment and generation opportunities.
By 2030, global freshwater demand could exceed supply by 40%, according to Barclays, driving demand for technologies targeted at boosting availability.