KNDS order and USV momentum to power growth, chg.

• The KNDS order win improves revenue visibility. It also underlines Steyr’s strategic relevance for key European land platforms. The long-awaited APU order from KNDS, mainly for the Leopard 2 and to a lesser extent the Leguan bridge-laying system, should contribute around € 40m to backlog (eNuW). The agreement includes a firm minimum volume of 500 units, with upside from further demand potential (eNuW: up to 500 additional units). Importantly, while the framework extends until 2034, delivery phasing is front-loaded, with 100 units due in 2026 alone (eNuW: c. € 8m sales, up c. 100% yoy) and roughly 80% of total volumes expected before 2030.

• USV business looks set to remain a key emerging growth pillar. Additional USV orders are expected in the coming weeks. Total USV sales should reach € 10m in 2026 (eNuW: 13% of group sales). Growth should remain strong as Steyr expands its addressable opportunity beyond the US into further markets such as the UK. Importantly, USV engines are closely linked to Steyr’s existing marine engines, implying that rising volumes should be manageable without dedicated expansion capex. In addition, the BUKH acquisition should further strengthen the offering by broadening the group’s addressable engine portfolio for USV applications.

• Guidance confirmed and backed by sizeable order pipeline. Steyr Motors reiterated its FY26 guidance of € 75-95m sales and an EBIT margin of above 15%. The outlook is supported by more than € 300m of secured orders for the 2026-30 period, providing a solid base for future growth, of which € 45m are expected to convert into organic sales in 2026. Including the BUKH acquisition from Q2 26, we currently forecast FY26 group sales of € 78m and an adj. EBIT margin of 15.7%. The estimate reflects the lower half of guidance, as we conservatively factor in some timing risk around order call-offs and delivery phasing.

While Steyr Motors continues to benefit from structurally rising defence budgets, the growth case increasingly also rests on broader platform penetration and further internationalisation, supported by the company’s differentiated high-power-density diesel engine technology for mission-critical applications. Recent announcements support this view: contracts with defence bellwethers such as Rheinmetall, KNDS and ST Engineering indicate rising platform adoption, while additional use cases continue to emerge. These include mobile power units, where series production is set to begin in H2 26, and USV applications, which appear to be gaining further commercial traction following initial contracts in H2 25.

Confirm BUY, new PT of € 60 (old: € 59), based on DCF.