First Read: Nexans SA "Site visit feedback: confident message from..."

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First Read: Nexans SA "Site visit feedback: confident message from..."

followed by lulls), management sees the market entering a new order cycle that will

replenish backlog further. Customer activity remains intense (e.g. TenneT, Terna, and

other major TSOs), with demand driven by energy sovereignty and data centre

electrification. Our view is that Nexans is well positioned to win orders with their

capacity available after 2028, unlike PRY and NKT who are booked out until 2030. We

are also encouraged by management stating they did not have capacity on XLPE to

compete on the recent €1.7bn award to Prysmian from the Greek grid operator (IPTO -

here) rather than it being a competitive issue.

Data centre outlook is getting progressively better in Europe & CEO impressed

by pace. European data centre demand is scaling rapidly: from ~50MW in 2025, to

200MW-300MW in early 2026 and now to ~1GW projects today, with a ~60% Grid /

40% Connect mix. The CEO spoke to growing US momentum (incl. Republic Wire) that

will pivot away from resi exposure, as they did in Europe (to lower than 20% From

>50%), and supplement with DC growth. This could add upside potential to Nexans’

target to take DC revenue from ~5% in 2025 to ~10% by 2028. Nexans' product offer

in Europe is helped by lower-carbon, added flexibility (for vertical DCs) and higher-

efficiency premium solutions.

M&A focus on medium voltage and US expansion. Management reiterated an

active M&A pipeline (after Republic Wire), but they will focus again on valuation.

Republic is adding 30% to its LV capacity so we think it would make strategic sense to

look for medium voltage assets in the US, and offer synergies if they did a land-based

expansion in the US for their Charleston facility. Medium voltage is described as a “huge