Shares that will be winners at the summer Games

There are still investment opportunities in the London Olympics, says Samantha Downes.

In exactly five months' time, to the day, the 2012 London Olympics opening ceremony will herald the start of the sporting world's greatest event. As soon as the games, current cost £10bn and counting, were awarded to London in 2005, experts heralded the huge investment opportunities it would present, citing areas such as infrastructure, tourism and property.

But even with just 20 weeks to go, there are still some short-term opportunities for investors who are seeking a sprinkling of sporting gold dust on their returns.

"During the games, hundreds of thousands of visitors will arrive along with the substantial sponsorship and media attention which can attribute much of the immediate economic benefit," points out Jon Wingent at Close Brothers Asset Management.

"Hosting an Olympics enhances investment opportunities that might not otherwise be there such as travel, tourism, leisure and retail. But the selective investment opportunities are much like holiday lets in that they are seasonal and unlikely to be long-term holds given the real economy that prevails behind the pomp and ceremony of the games."

Trevor Green, manager of UK equities at Aviva, is a bit more positive. He believes that the Olympics effect will outlast the games themselves for several months afterwards.

"The revenue potential for businesses associated with the event can last much longer than the 19 days it takes to stage the event," he says.

Even so, investing in the 2012 Olympics is not for the faint-hearted. The opportunities are better-suited for proactive investors who are prepared to ride out any stock market bumps.

Leisure and tourism

Leisure and tourism are a couple of the more obvious beneficiaries of the Olympics, according to investment advisers Hargreaves Lansdown.

The firm's Danny Cox says the brewery giant Greene King and airlines such as International Airline Group – which includes British Airways and Iberia – and easyJet could see their share prices rise as a result of increased tourism.

He says investors looking to spread their risk with a collective investment should consider Marlborough Multi-cap income fund, which has Greene King as its largest holding.

Travel company Thomas Cook may have been in the doldrums of late, but it could benefit from being both a direct sponsor and beneficiary of the Olympics, says Mr Cox.

The world's oldest travel firm is an official sponsor of this year's Olympics and Paralympics. As such, Mr Cox believes it could benefit from a corporate hospitality programme that will see it as the only official Olympics UK travel provider.

Meanwhile, Mr Green says the hotel sector will benefit from short-term gain.

"Already it appears some hotels intend to raise prices of up to five times their normal tariffs while the Olympics is on," he says. "Of course, if you are looking to book a hotel this is alarming, but it does suggest highly profitable times to come for some chains."

Firms that could benefit include Millennium & Copthorne and Whitbread, operator of the Premier Inn chain.

However, it's worth bearing in mind the example of thr 1996 Atlanta Games, says Mr Green, when the number of available hotel rooms ballooned by 15 per cent.

"The rooms may have been full for the duration of the Olympics, but all that extra supply destabilised the market after the visitors had gone."

Sports

Listed companies which specialise in sports and leisure stand to benefit from an increased interest in all things fitness related. Companies that could feel the love from the Olympics include Sports Direct.

"Despite many of its rivals floundering, Sports Direct, the UK's leading sports retailer, has prospered and will hope to benefit further from any Olympics-led boost to demand," says Mr Cox.

As the Olympics takes place outside the football season, Sports Direct could benefit from a fillip given that it would otherwise be in the middle of a summer lull, says Mr Green.

Other less obvious Olympic beneficiaries could include Halfords. The success of the UK's cycling team could provide the retailer with a lift in sales of its bicycles after those watching the world's best in action on their doorstep are inspired to give two wheels a go.

Energy and security

The security company G4S, which secured a £100m deal last March to provide security for the Olympic and Paralympic Games, could make much of the opportunity.

"It was also recently chosen as a preferred bidder for Project Compass, which relates to the provision of asylum-seeker support services," Mr Cox reports.

And of course athletes need hot (and cold) showers while they are training for the games.

"Energy company Aggreko is an exclusive supplier of temporary energy services for the London games. The company will provide about 220 megawatts of power, some 60 megawatts more than it supplied at the 2008 Beijing Olympic Games," Mr Cox points out.

Food and drink

Like them or loathe them McDonalds and Coca Cola are considered by analysts to be strong buys as their brands will be everywhere come the end of June.

McDonalds will open its largest outlet close to the Olympic Park ,while Coca Cola is said to be the most recognised official partner of the London 2012 Olympic and Paralympic Games in terms of consumer brand awareness.

Telecoms and other sponsors

"You could consider telecom companies such as Vodafone, which will experience increased mobile phone traffic in London and is a sponsor of the games," says Mr Cox.

Other sponsors worth considering include BP, Lloyds TSB and BT Group, while Neil Veitch of SVM Asset Management says Virgin Media is another stock to watch.

"It has pulled off a bit of a coup in recruiting the world's fastest man to front their latest advertising campaign. As Usain Bolt seeks to repeat his feats of Beijing 2008, expect the company to draw parallels between his performance and their broadband speeds."

Shopping

Not everyone will want to watch the Olympics, and there may be those actively avoiding the games, particularly tourists who will consider the games as the perfect down time to explore what is considered one of the world's greatest shopping destinations.

"The West End of London has seen phenomenal growth recently on the back of a weak sterling as visitors have been attracted to London for shopping, as regularly highlighted by Shaftesbury, the West End real estate operator," says Mr Green.

He believes the retail effect can only magnify during the games as visitors split their time between watching sport and spending money in the capital.

"Luxury, world-famous UK brands like the Burberry Group, which has announced plans to double its existing store space in time, stand to gain from the influx of extra visitors coming to London," he predicts.

Couch potatoes

Then there are those companies that stand to gain from those who failed to get a ticket in the public ballot or who cannot afford the hotel prices to see the games live in London.

Mr Green says advertisers will be clamouring to get on TV.

"The Olympics are as big as it gets, and the London games are expected to surpass Beijing's 4.7 billion television viewers. Although the BBC will be the lead broadcaster, one of the biggest commercial beneficiaries will be rival ITV, as advertisers clamour to advertise during the games. This may just give a one-off benefit to the company, but it will be a very welcome boost nonetheless."

And those who can afford to advertise will gain too. "One company who may well be advertising on television is Britvic. Events such as the Olympics are not only good for sales but also offer an unrivalled opportunity to launch a new product onto the global market."

And ones to avoid

Of course, for every winner there has to be a loser, and not everyone will benefit from the games coming to London.

"Potential losers include Tui Travel," says Mr Green. "They will have the headache of bookings coming in even later than usual as the public decides at the last minute to go abroad pre or post the games, thus making their scheduling very difficult.

"Leisure operators such as Cineworld and Goals Soccer Centres may have a quiet 19 days as their customers' attention is focused elsewhere."

A run for their money

Economy boost

The Olympics (held from 27 July to 12 August) is expected to give a £5.1bn cash injection to the economy. The Paralympic Games follow from 29 August to 9 September.

Encourage spending

During the Games, consumer spending is predicted to hit £750m. It will be the third time London has hosted the event. Previous times were in 1908 and 1948 (pictured: the wrestler Ray Myland).

Global audience

A total of 204 nations are participating. There are 300 events to win medals in, made up of 26 sports, which break down into 39 disciplines.

Sponsors

There will be branding all over the Games, with 53 different companies having paid out to be associated with the event, including 11 worldwide partners and seven London 2012 Official Olympic Partners.

Cashing in

Londoners with property near Olympic venues are hoping to make a mint. There has been a 444 per cent increase in average asking prices for short-term rentals in July 2012 compared to July 2011's figure, according to Gumtree.com. The average price is now £2,858.33 per week.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Life and Style
Baroness Lane-Fox warned that large companies such as have become so powerful that governments and regulators are left behind
techTech giants have left governments and regulators behind
News
Keith Fraser says we should give Isis sympathises free flights to join Isis (AFP)
news
Life and Style
'Prison Architect' players decide the fate of inmates
tech
Life and Style
A picture taken on February 11, 2014 at people walking at sunrise on the Trocadero Esplanade, also known as the Parvis des droits de l'homme (Parvis of Human Rights), in front of the Eiffel Tower in Paris.
techGoogle celebrates Paris's iconic landmark, which opened to the public 126 years ago today
News
Cleopatra the tortoise suffers from a painful disease that causes her shell to disintegrate; her new prosthetic one has been custom-made for her using 3D printing technology
newsCleopatra had been suffering from 'pyramiding'
News
people
Arts and Entertainment
Coachella and Lollapalooza festivals have both listed the selfie stick devices as “prohibited items”
music
Sport
Nigel Owens was targeted on Twitter because of his sexuality during the Six Nations finale between England and France earlier this month
rugbyReferee Nigel Owens on coming out, and homophobic Twitter abuse
Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Trainee Consultant - Surrey / South West London

    £22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

    Ashdown Group: Trainee Consultant - Surrey/ South West London

    £22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

    Recruitment Genius: Client Services Assistant

    £18000 - £20000 per annum: Recruitment Genius: A Client Services Assistant is ...

    Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

    £25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

    Day In a Page

    No postcode? No vote

    Floating voters

    How living on a houseboat meant I didn't officially 'exist'
    Louis Theroux's affable Englishman routine begins to wear thin

    By Reason of Insanity

    Louis Theroux's affable Englishman routine begins to wear thin
    Power dressing is back – but no shoulderpads!

    Power dressing is back

    But banish all thoughts of Eighties shoulderpads
    Spanish stone-age cave paintings 'under threat' after being re-opened to the public

    Spanish stone-age cave paintings in Altamira 'under threat'

    Caves were re-opened to the public
    'I was the bookies’ favourite to be first to leave the Cabinet'

    Vince Cable interview

    'I was the bookies’ favourite to be first to leave the Cabinet'
    Election 2015: How many of the Government's coalition agreement promises have been kept?

    Promises, promises

    But how many coalition agreement pledges have been kept?
    The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

    The death of a Gaza fisherman

    He built his own reef, and was fatally shot there by an Israeli gunboat
    Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

    Saudi airstrikes are fuelling the Gulf's fire

    Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
    Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

    The only direction Zayn could go

    We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
    Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

    Spells like teen spirit

    A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
    Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

    If fashion is a cycle, this young man knows just how to ride it

    British designer Jonathan Anderson is putting his stamp on venerable house Loewe
    Number plates scheme could provide a licence to offend in the land of the free

    Licence to offend in the land of the free

    Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
    From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

    From farm to fork in Cornwall

    One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
    Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

    Robert Parker interview

    The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
    Don't believe the stereotype - or should you?

    Don't believe the stereotype - or should you?

    We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor