JPM | Industrial Strength Morning Messages: Jaw Jaw for now

Research evidence excerpt

JPM | Industrial Strength Morning Messages: Jaw Jaw for now

ost Q2 wrap - self-help story remains intact - Akash Gupta (HERE): KB reported solid Q2 results that

modestly exceeded consensus, while its 2030 targets were somewhat conservative. The sell-side meeting with management

(CEO and CFO) offered incremental insights into the planning of new medium term targets that strengthens our view that the

announced targets are conservative. The management is driving changes in the DNA of the company by making it more

nimble and innovative, expanding the target markets, and hiring new talent to boost the entrepreneurial aspects. There is a

strong desire to differentiate and transform KB into a best-in-class Capital Goods company. We maintain our 2026 operating

EBIT estimates, as a reduction in our revenue estimate is offset by higher margins, while cutting 2027 operating EBIT

forecast by 2% due to dilution from the sale of the HVAC business, which will boost RVS margin by ~80bps in 2027. We

maintain our Neutral rating with €108 price target.

5. EUROPEAN CHEMICALS REACTION: Chetan Udeshi (HERE): Learnings from earnings so far: Margin normalization

in commodity chemicals appears to be underway—most visibly in China—yet the companies that have reported so far

continue to describe volumes/demand as robust into July, with limited evidence of the destocking some (including us and

several clients) had expected following the March/April pre-/panic-buying and the subsequent easing in pricing. That said,

visibility remains low, not least given the uncertainty tied to the ongoing Middle East conflict.

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