CSG Joins the AMX Index, but a 60% Rout Persists as Defence Growth Masks Ammo Weakness

Czech defence contractor CSG sees share price drop 60% from January high, even as revenue and profit soar, order book hits €17bn, and Euronext promotes it to AMX index.

The Czechoslovak Group presents one of the more puzzling stories in European equities right now. Record orders, an index promotion and an 83% profit surge have done nothing to arrest a share price slide that has wiped out more than 60% of the stock’s value since late January.

Euronext will admit the Czech defence contractor to the AMX, the Dutch mid-cap index, on 22 June following a quarterly review announced on 9 June. The move improves CSG’s visibility among benchmark?tracking funds but arrives as the stock trades barely above its all?time low. At Wednesday’s close of €14.35, the shares are more than 60% below the 52?week high of €36.05 reached on 26 January. The 30?day decline alone amounts to roughly 10%, and the relative strength index sits at 29.2, signalling oversold conditions without offering a clear buy trigger.

The operational picture tells a very different story. First?quarter revenue hit €1.544bn, up 13.8% year on year, while net profit jumped 83% to €299m. The net margin widened from 12% to 19%. The Defence Systems division drove the performance, with revenue climbing 26.5% to €1.251bn and an operating margin of 28.4%. The order book swelled to €17bn by the end of March, up from €15bn at the close of 2025, and the negotiation pipeline stands at €27bn.

Yet not all segments fired on all cylinders. The Ammo+ unit saw revenue fall from €366m to €291m, hit by weak demand in the US civilian market for small?calibre ammunition. Management reported a recovery towards the end of the quarter, but the sustainability of that rebound will not be clear until the half?year numbers land on 7 August.

Germany this week placed another €300m order for approximately 50,000 rounds of long?range ammunition, bringing total commitments under the Czech?led ammunition initiative to €1.3bn. CSG has now signed contracts this year to deliver around one million rounds of ammunition to Ukrainian forces. The company’s industrial footprint continues to expand: the Polish subsidiary CSG Polska signed a letter of intent with WSK “PZL?KALISZ” of the state?owned PGZ group to produce, develop and maintain engines and components for heavy off?road vehicles, targeting export customers in NATO and EU states. Separate contracts for mechanical and electronic fuses for large?calibre ammunition, together worth a high double?digit million euro sum, were also secured. Production of the electronic fuses will be handled by a new joint venture with South Africa’s Reunert in Slovakia.

Management has reaffirmed its full?year guidance: revenue between €7.4bn and €7.6bn, with an operating EBIT margin of 24?25%. Large?calibre ammunition output is on track to reach 850,000 units by the end of 2026, compared with 550,000 last year.

Analyst sentiment remains emphatically bullish. All ten analysts covering the stock rate it a buy, with a consensus price target of €32.05 and a high of €42. The gap between that target and the current market price is unusually wide.

Technically, the stock sits roughly 24% below its 50?day moving average, and 30?day annualised volatility has surged to nearly 77% — a fragile backdrop for any turnaround attempt. Whether the AMX inclusion will draw institutional buyers and provide a floor remains to be seen. The most concrete test for the market’s scepticism will come on 7 August with CSG’s half?year report.