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

INDUS kicks off FY26 with a strong Q1 and raised guidance

Yesterday, INDUS released its Q1 report, following the release of

preliminary revenue and adj. EBITA on April 30th. Key details from this

strong Q1-release:

Kicking off the year with a strong Q1 performance, Q1 revenue grew by 9.4%

yoy to EUR 442m, driven by improvements across segments. Inorganic growth

contributed 2.2% yoy. The adj. EBITA rose by 70.7% yoy to EUR 42.5m, with the

adj. EBITA margin increasing by 3.4pp yoy. Due to BETEK's successful

management of the price increase in tungsten carbide as a key raw material,

Material Solutions showed significantly elevated margins.

Material Solutions adj. EBITA margin came in hiked by 7.9pp yoy to 16.8%

(eNuW: 14.7%) through positive pricing and volume developments in BETEK (51%

of Material Solutions revenue in FY25). This clearly underlines once again

BETEK's proactive and dynamic management of the special situation concerning

tungsten. Not only has it established sufficient supply, despite significant

elevation of cost. Backed by the holding, it is seizing the opportunity to

gain market share in tungsten-related products, as smaller competitors

partially signal silent retreat. Segment revenue rose by 17.5% to EUR 168m

(eNuw: EUR 174m) and adj. EBITA soared by 122% yoy to EUR 28.2m (eNuW: EUR 24.7m).

Engineering beat growth expectations with revenue of EUR 131m (eNuW: EUR 124m),

up 6.1% yoy, based on stronger than anticipated organic growth of 2.3% yoy.

Inorganic growth contributed + 3.8% yoy. The adj. EBITA margin reached only

3.9% (eNuW: 5.5%), impacted by seasonality and capacity utilization, leading

to an adj. EBITA of EUR 5.1m (eNuW: EUR 6.8m), down 20.3% yoy.

Infrastructure beat bottom-line expectations. The adj. EBITA rose by 36% yoy

to EUR 13.6m, due to cost optimization, efficiency gains and the successful

repositioning of a portfolio company. Revenue grew by 6.1% yoy to EUR 143m

(eNuW: EUR 144m) largely in line with expectations and supported by inorganic

growth of 5.1% yoy from FY25 acquisitions.

The order backlog rose by 24.5% yoy to EUR 826m, supported by strong order

intake, up 15.4% yoy to EUR 525m (book-to-bill ratio 1.19). This was mainly

driven by growth in tungsten carbide-tipped wear tools supporting a 28.3%

yoy increase in Material Solutions orders and strong demand for digital

infrastructure products leading to a 25.5% yoy increase in Infrastructure

orders. Engineering orders came in slightly lower by 3.8% yoy at EUR 165m,

while maintaining a strong book-to-bill for the segment at 1.26x.

Working Capital increased by EUR 57.8m yoy, reflecting investments in

inventory of c. EUR 68.5m yoy. C. EUR 48m (eNuW) of this should be related to

higher tungsten-related material prices and risen tungsten purchase volume.

Under current circumstances, we view increased procurement of tungsten at

higher prices as essential to raising BETEK's market share against small

competitors. While the pricing volatility could also pose risks of

normalization, we view the demand for tungsten to remain high in the months

to come. This investment into inventory has a strong negative impact on the

Free Cash Flow, reported at EUR -74.1m, it is seen as an investment into

stronger organic growth in BETEK for the short- to mid-term.

Starting strong into the year on a positive signal, the increased FY26

guidance reflects the expectation of solid underlying developments and a

short-term catalyst from the tungsten special situation. FY26e revenue is

anticipated at EUR 1.92 bn (eNuW), implying growth of 10.7% (eNuW). Adj. EBITA

is seen to rise by 21.1% yoy to EUR 179m (eNuW), supported by a stronger

topline, disciplined cost management, operational excellence improvements

and inorganic first-time contributions. Over the course of the year, we

expect the topline to strengthen, driven by positive price and volume

effects from organic growth, seasonality and first-time revenue

contributions from acquisitions announced so far. Confirming BUY at a PT of

EUR 37.0, based on FCFY 26e.

You can download the research here:

https://eqs-cockpit.com/c/fncls.ssp?u=2191ca0d3fb9293b239563d83d8a156a

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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

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2326660 13.05.2026 CET/CEST

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