NKT (1K) | Reduce | On track, but possibly overheated

研报英文原文证据摘录

NKT (1K) | Reduce | On track, but possibly overheated

NKT Reduce | Target Price: DKK780.00

Company description Management

NKT is a supplier of AC/DC cable solutions. The company operates via the following Nicola Piovan, Chairman

business lines: Solutions (high voltage), Applications (medium voltage), Services & Filippo Zuppichin, CEO Giovanni Rigodanza, CFO

Accessories. The company has production plants, and it sells mostly in Europe, with

some presence in North America and to a lesser degree in APAC. It boasts strong Key shareholders

relationships with the European TSOs and a solid footprint in HVDC solutions. NKT is Free float 100.00% Blackrock 5.00%

headquartered in Denmark and listed on the Nasdaq Copenhagen.

Investment case Valuation methodology

n NKT is a leading player in power cable solutions. It enjoys a n Our base-case DCF (WACC: 7.8%, TG: 3%, terminal EBIT

solid backlog, the second largest in the industry after margin: 13%) points to DKK780.

Prysmian, which provides good coverage of the revenue n A blue-sky DCF with no margin fading post 2030 points to

trajectory to 2028. DKK990.

n The high-voltage cable market is capacity constrained with Risks to our rating

high entry barriers. NKT boasts solid positioning in HVDC, a n Stronger book-to-bill.

solid execution track record, and longstanding relationships

n Higher than expected trajectory on P&L and cash generation. with the European TSOs.

n NKT is investing to expand its capacity, with a EUR2bn capex n A disciplined stance on capacity additions in the industry

plan over 2025-28. This will likely keep cash flow negative until might be positive for margins. The evolution of political

2027. P&L growth over 2025-26 is set to remain limited, with an decisions in Europe and (less important for NKT) in the US on