Original-Research: INDUS Holding AG (von NuWays AG): BUY

Classification of NuWays AG to INDUS Holding AG

Company Name:	INDUS Holding AG
ISIN:	DE0006200108
Reason for the research:	Update
Recommendation:	BUY
Target price:	EUR 37
Target price on sight of:	12 months
Last rating change:
Analyst:	Sarah Hellemann

Material momentum: double-digit Q2 ahead INDUS is scheduled to release its H1 report on August 12th. We expect strong growth on top- and bottom-line for Q2. In detail: Double-digit Q2 sales growth (eNuW: +12% yoy), leading to € 486m (eNuW) is anticipated, based on a temporarily boosted Material Solutions performance due to continued tungsten supply shortage caused by Chinese export controls and seasonally stronger Infrastructure benefitting from rising construction output and excellent weather. A combination of organic and inorganic growth should support a yoy outperformance of Engineering. Q2 adj. EBITA is expected to rise by 20.6% yoy to € 37.6m (eNuW). Revenue growth and improved capacity utilization are to outweigh elevated material costs from the tungsten special situation. The implied adj. EBITA margin is seen to expand by 0.5pp yoy to 7.6% (eNuW). Engineering should contribute 7.5% yoy revenue growth to € 147m (eNuW), outperforming its sector based on recent quarters strong order intake bringing the book-to-bill to 1.26x (Q1 26) and inorganic growth from FY26 acquisitions. Despite the top-line growth, we anticipate a 1.5pp yoy drop in adj. EBITA margin to 5.5% (eNuW) as the challenging mechanical engineering environment (VDMA economists lowering their growth projection for FY 26 from 1% to 0%; Source: VDMA) poses pricing pressure risks. The adj. EBITA contribution is to fall by 15.1% yoy to € 8.1m (eNuW). Infrastructure is seen to grow 12.2% yoy to € 175m sales (eNuW), carried by construction growth picking up (i. e. German construction up 3.5% yoy in May; Source: Federal Statistical Office) and above average seasonally on a count of a particular warm and sunny Q2. This strong growth should raise adj. EBITA by 13.3% yoy to € 18.7m (eNuW), implying a double-digit margin of 10.7% (eNuW; +0.1pp yoy). Material Solutions is expected to continue benefiting strongly from tungsten supply shortages through BETEK (51% of Material Solutions revenue in FY25). BETEK's proactive management of the situation — securing tungsten supply and implementing significant price increases — already drove a 7.9pp yoy margin expansion in Q1 2026 through favorable pricing and volume effects. We conservatively forecast 16% yoy sales growth to € 164.6m (eNuW) and a 4.7pp yoy increase in the adj. EBITA margin to 12.0% (eNuW), implying adj. EBITA of € 19.8m (eNuW), up 90% yoy. FY26e on track. Overall, the FY26 guidance of € 1.85-2.05bn in sales and adj. EBITA: € 160-190m, at an implied adj. EBITA margin of 8-10% continues to look achievable. At the current expected run-rate, INDUS should be well positioned to delivering the mid- to upper range of its guidance. We project € 1.92 bn in sales (eNuW) and € 179m (eNuW) in adj. EBITA on an implied margin of 9.3% (eNuW). Effects from higher German Infrastructure spending and a stronger-than-anticipated Material Solutions performance continue to provide further upside potential. Confirming BUY at a PT of € 37, based on FCFY 26e.   You can download the research here: indus-holding-ag-2026-07-28-previewreview-en-ff143 For additional information visit our website: https://www.nuways-ag.com/research Contact for questions: NuWays AG - Equity Research Web: www.nuways-ag.com Email: research@nuways-ag.com LinkedIn: https://www.linkedin.com/company/nuwaysag Adresse: Mittelweg 16-17, 20148 Hamburg, Germany ++++++++++ Diese Meldung ist keine Anlageberatung oder Aufforderung zum Abschluss bestimmter Börsengeschäfte. Offenlegung möglicher Interessenkonflikte nach § 85 WpHG beim oben analysierten Unternehmen befindet sich in der vollständigen Analyse. ++++++++++