Original-Research: Nabaltec AG (von NuWays AG): BUY

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Original-Research: Nabaltec AG - from NuWays AG

05.08.2025 / 09:00 CET/CEST

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Classification of NuWays AG to Nabaltec AG

Company Name: Nabaltec AG

ISIN: DE000A0KPPR7

Reason for the research: Update

Recommendation: BUY

from: 05.08.2025

Target price: EUR 18.00

Target price on sight of: 12 months

Last rating change:

Analyst: Christian Sandherr

Revised FY25 guidance due to FX effect and weaker demand

With the release of its preliminary Q2 figures Nabaltec also lowered its

FY25 sales guidance, expecting a 1-2% yoy decline (old: 3-5% yoy sales

growth, eNuW old: 5.7% sales growth). This is the result of an adverse FX

effect ($ 30m exposure with USD/EUR of 1.17 vs 1.05 at the beginning of the

year) but also continued weaker demand from industrial and automotive

customers, especially for boehmite (coating solution for separator foils in

EV batteries. Positively, management left the FY EBIT margin guidance

unchanged at 7-9% (eNuW old: 9.7%) despite lower sales volumes as the

material cost ratio improved (lower energy price mix). The H1 margin stood a

8.4%.

Q2 recap: Preliminary Q2 group sales decreased by 4.6% yoy to EUR 51.8m.

Specialty Alumina remained weak at EUR 13.6m (-8.1% yoy) due its dependency on

the steel industry. Functional Fillers sales of EUR 38.2m were down 3.3% yoy,

mainly as a result of continued weak demand for boehmite. The sales decline

witnessed during recent years (FY24 -25% yoy) looks set to persist

throughout FY25 due to lackluster EV demand across Europe and the ongoing

absence of notable cell and separator production capacities.

Positively, the underlying demand for its core product, aluminum hydroxide

(ATH), the environmental friendly flame retardant used in cables and

plastics, but also the visco-optimized gap filler remained strong. After the

latter has grown some 100% yoy in FY24 to EUR 10m, we expect anther 25%

increase for FY25e. The EBIT margin in Q2 came in at 9.1% (-1.7pp yoy),

notably better than in Q1 as energy prices moved in favour of Nabaltec.

While the current operational performance remains subdued, the prospects

remain promising. Nabaltec is able to benefit from growing demand for ATH on

the back of tightening regulations across its core end markets, vast

investments into data centers and renewable energies but also Germany's EUR

500bn infrastructure spending bill. The latter is seen to also turn into a

tailwind for the company's Speciality Alumina segment, which is strongly

tied to the European steel industry. While boehmite sales have been

declining for several years, the product continues to have potential during

the mid-term, depending on European ramp up of battery cell productions.

From 2026e onwards, first positive implications as well as general demand

normalizations are seen to materialize, eNuW.

Amid the currently subdued operational performance, the valuation remains

low with shares trading 15% below their book value. Further, Nabaltec offers

a healthy balance sheet with good sustainable operating cash flow generation

throughout economic cycles. We hence continue to regard Nabaltec as a must

own stock within its space. BUY with a new EUR 18 PT (old: EUR 24) based on FCFY

2025e.

You can download the research here:

https://eqs-cockpit.com/c/fncls.ssp?u=b5dc8ff242dd5a5f891d5188976b7a9b

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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2179348 05.08.2025 CET/CEST

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