Original-Research: Scandinavian Astor Group AB (von NuWays AG): BUY

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Original-Research: Scandinavian Astor Group AB - from NuWays AG

31.03.2025 / 09:06 CET/CEST

Dissemination of a Research, transmitted by EQS News - a service of EQS

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Classification of NuWays AG to Scandinavian Astor Group AB

Company Name: Scandinavian Astor Group AB

ISIN: SE0019175274

Reason for the research: Update

Recommendation: BUY

from: 31.03.2025

Target price: SEK 39.00

Target price on sight of: 12 months

Last rating change:

Analyst: Henry Wendisch

Faster growth as Sweden ramps up defence spending; PT up

Topic: Last Friday, we hosted an investor call with CFO Billström who gave

detailed insights into the new mid-term targets and the short-term M&A

pipeline. Further, Sweden aims to significantly ramp up defence spending to

3.5% of GDP by 2030. In detail:

New mid-term targets to be mainly stemmed from organic growth. Contrary to

our previous assumption, 2/3 of the new mid-term targets announced last week

(SEK 2.5bn sales with more than 15% EBITDA margin by FY'28e) should stem

from an organic sales CAGR of 20% (incl. the full acquisition of the SEK

500m sales of the short-term M&A pipeline). The scenario of a 30% organic

sales CAGR (vs. 44% yoy organic growth in FY'24) would imply 90% of the

mid-term target to stem from organic growth alone, meaning that only little

M&A (in '26, '27 and '28) would be necessary to achieve the target.

More M&A expected shortly: Following the resolved SEK 150m capital increase,

Astor looks at a wellfilled and defence heavy M&A pipeline. Moreover, Astor

has moved Airsafe into a new segment called Astor Protect effective 1st

April '25 and has made place for a fourth, so far unknown segment "Astor X".

For both new segments, we expect new additions soon.

Sweden ramps up defence spending even more. Also last week, Swedish PM Ulf

Kristersson announced that the country will provisionally aim to increase

defence spending to 3.5% of GDP by 2030. This is a much bigger and faster

ramp-up than previously communicated (2.6% in FY'30). According to our

calculation, this implies the defence spending FY'2430 CAGR to almost double

from 7% to 12%.

Organic growth estimate raised: Our old FY'28e sales estimate stood at SEK

586m (not including the short-term M&A pipeline) and was based on an organic

sales CAGR of 17% (25e-28e). Against the backdrop of the defence spending

hike as well as the company's strong defence exposure, our old estimate

seems too conservative. Therefore, we increase our organic growth assumption

to an organic sales CAGR of 20% (25e-28e), but also increase our OPEX and

CAPEX assumption, which will become necessary to foster that growth.

Therefore we increase our DCF-based PT to SEK 39.00 (old: SEK 30.00) and

reiterate our BUY recommendation.

You can download the research here: http://www.more-ir.de/d/32088.pdf

For additional information visit our website:

https://www.nuways-ag.com/research-feed

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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Offenlegung möglicher Interessenskonflikte nach § 85 WpHG beim oben

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2108676 31.03.2025 CET/CEST

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