Topic: Last Friday, we hosted an investor call with CFO Billström who gave detailed insights into the new mid-term targets and the short-term M&A pipeline. Further, Sweden aims to significantly ramp up defence spending to 3.5

% of GDP b

y 2030. In detail:

New mid-term targets to be mainly stemmed from organic growth. Contrary to our previous assumption, 2/3 of the new mid-term targets announced last week (SEK 2.5bn sales with more than 15% EBITDA margin by FY’28e) should stem from

an org

anic sales CAGR of 20% (incl. the full acquisition of the SEK 500m sales of the short-term M&A pipeline). The scenario of a

30% orga

nic sales CAGR (vs. 44% yoy organic growth in FY’24) would imply 90% of the mid-term target to stem from organic growth alone, meaning that only little M&A (in ‘26, ‘27 and ‘28) would be necessary to achieve the target.

More M&A expected shortly: Following the resolved SEK 150m capital increase, Astor looks at a well-filled and defence heavy M&A pipeline. Moreover, Astor has moved Airsafe into a new segment called Astor Protect

effective 1st April ‘25

and has made place for a fourth, so far unknown segment “Astor X”. For both new segments, we expect new additions soon.

Sweden ramps up defence spending even more. Also last week, Swedish PM Ulf Kristersson announced that the country will provisionally aim to increase defence spending to 3.5% of G

DP by 2030.

This is a much bigger and faster ramp-up than previously communicated (2.6% in FY’30). According to our calculation, this implies the defence spending FY’24-30 CAGR to almost double from 7% to 12%. - see p. 2 for details

Organic growth estimate raised: Our old FY’28e sales estimate stood at SEK 586m (not including the short-term M&A pipeline) and was based on an organic sales CAGR of 17% (25e-28e). Against the backdrop of

the

defence spending hike as well as the

company’s

strong defence exposure, our old estimate

seems

too conservative. Therefore, we increase our organic growth assumption to an organic sales CAGR of 20% (25e-28e), but also increase our OPEX and CAPEX assumption, which will become necessary to foster that growth.

Therefore we increase our DCF-based PT to SEK 39.00 (old: SEK 30.00) and reiterate our BUY recommendation.