Indus Holding: Material momentum triggers sig. guidance hike; PT Up - NuWays AG Research
Yesterday, INDUS significantly hiked its guidance in expectation of an exceptional Q2 result, given strong momentum in Material Solutions related to the tungsten special situation.
ANNONS
Prel. Q2 revenue rose by 20.6% yoy to € 523.7m, notably beating our expectation of € 486m. The key contributor was Material Solutions, with portfolio company BETEK performing exceptionally strongly amidst the current supply shortage in tungsten products. It benefitted from pricing, additional high-margin orders across all application areas, and gained market share. We attribute € 50-60m (eNuW) of revenue to this special situation as a positive one-off effect. At the same time, the other two segments were indicated to have performed in line with expectations.
Special situation to boost FY26 EPS. We project EPS to double compared to FY25 to € 5.5/share, as Chinese export restrictions and high tungsten demand, partially driven by global defense, seem unlikely to normalize in the short term (at least in H2) at this point. We hence assume that BETEK's current commercial momentum will largely persist in FY26. In our opinion, this windfall potentially provides room for accelerated inorganic growth or additional shareholder returns.
Confirming BUY at a raised PT of € 41 (previously € 37), as we move from FCFY26 to FCFY27 to better reflect a more normalized operational picture of the group.
