Classification of NuWays AG to Scandinavian Astor Group AB

Company Name:	Scandinavian Astor Group AB
ISIN:	SE0019175274
Reason for the research:	Update
Recommendation:	BUY
Target price:	SEK 27
Target price on sight of:	12 months
Last rating change:
Analyst:	Simon Keller

Less sail, same course, chg.

Astor's growth potential remains attractive, although order timing warrants a more cautious earnings outlook. We cut estimates and our PT to reflect sustained order intake weakness and delivery risks, while retaining BUY. Q3 should bring sequential margin recovery, with Industry, Ammunity and NSG supporting growth beyond near-term procurement delays.

Underlying demand is seen to support stronger order intake ahead. Q2 order intake of SEK 81m implied a book-to-bill of just 0.5x. Quarterly intake can be lumpy in defence, with larger individual contracts and lengthy government procurement processes affecting award timing. The SEK 610m June backlog provides substantial coverage, with SEK 595m scheduled for delivery in 2026, although Q2's slippages highlight the risk of further postponements. While September's SEK 35m Protect order and October's SEK 33m Marstrom award are encouraging, the announced wins have yet to establish a sustained recovery (eNuW). Nevertheless, strong backlogs at Industry's prime contractor customers should eventually feed through into supplier orders as production ramps up (eNuW). In Q2, Astor also highlighted high quotation activity, with ongoing customer discussions supporting further capacity investment. These signals support our expectation that order intake will regain momentum in Q4. Still, our revised forecasts allow more time for contract awards and deliveries to materialise (eNuW).

Three pillars support the growth case. The Industry segment provides a solid manufacturing base, with its stronger defence mix supporting EBITDA margins of >20% (eNuW). Ammunity's capacity expansion offers substantial organic upside (capacity to increase by up to 6x vs 2025 level), with Latvian government procurement the key variable in converting capacity into sales, in our view (see p.2). NSG's FY27 growth should benefit from ammunition stockpiling, tighter infrastructure-protection requirements and rising civil-protection budgets, driving demand for its secure storage, hardened data centres and shelters (eNuW).

Q3 should bring sequential margin recovery. Sales look set to arrive at SEK 240m (+205% yoy), including SEK 154m from acquisitions (eNuW). Industry should contribute c. SEK 50m, assuming the H1 sales pace of c. SEK 25m per month and allowing for a month of summer holidays. Protect should generate c. SEK 190m, supported by NSG's first full quarter of consolidation and c. SEK 5m of deliveries shifted from Q2 (eNuW). EBITDA is set to rise 87% yoy to SEK 29.8m (eNuW), implying a 12.4% margin versus Q2's underlying 6.2%. The 6.2pp sequential recovery should benefit from delayed deliveries, a more normal product mix and NSG's larger contribution. It also comes without the previous at-equity margin support: NSG now contributes both sales and earnings through full consolidation.

Fresh capital to support further acquisitions. September's SEK 114m gross equity raise increases financial flexibility. Astor is evaluating targets with combined sales above SEK 850m and EBITDA above SEK 125m. The pipeline offers further growth potential beyond the existing portfolio, subject to transactions being agreed and completed.

Action: We lower sales estimates by on avg. 12% for 2026-28e. Lower fixed-cost absorption, dilution from the capital increase and a corresponding model overhaul reduce EPS by on avg. 37% over the same period. We reiterate BUY with a new PT of SEK 27 (old: SEK 46), based on a blend of DCF and peer group valuation. - continued -

You can download the research here: scandinavian-astor-group-ab-2026-10-22-update-en-3850f
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
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Offenlegung möglicher Interessenkonflikte nach § 85 WpHG beim oben analysierten Unternehmen befindet sich in der vollständigen Analyse.
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