Thyssenkrupp Weighs Submarine Bonanza Against Steel Turbulence as Restructuring Grinds On

Thyssenkrupp stock rallies 50% from March low. Overbought. Key: €37B submarine bid, €26B frigate, EU steel import cuts. Hydrogen Nucera posts losses. Internal pushback on restructuring.

Thyssenkrupp closed last week at €10.85, up 1.36% on the day and roughly 23% higher than a month ago. The rally has been remarkable — the stock has climbed more than 50% from its 52-week low of €7.15 in March — but the pace has pushed the relative strength index to 87.4, signalling overbought conditions. With a 52-week ceiling at €13.24 still in play, the next moves will depend on whether the group can convert a string of massive military tenders and regulatory relief into tangible restructuring progress.

TKMS: Three shots at a windfall. The marine subsidiary remains the crown jewel. Canada is expected to decide between May and June 2026 on the purchase of 12 new submarines, a contract valued at up to €37 billion. Thyssenkrupp Marine Systems is bidding the 212CD-class, designed for Arctic operations, against South Korea's Hanwha Ocean. Simultaneously, the German parliament's budget committee is likely to approve a €26 billion frigate project around June 2026, for which TKMS is currently the sole qualified bidder. The unit's order backlog has already swelled past €20 billion following a follow-on order from Norway — a record level that underscores the division's strategic heft.

Nucera: A study in contrasts. The hydrogen arm offers a more sobering picture. While second-quarter order intake quadrupled to €316 million — driven largely by a 300MW green-hydrogen plant for Spain's Moeve, the largest such facility in southern Europe — revenues collapsed 77% to €50 million. The operating loss ballooned from €4 million to €65 million, blamed on cost overruns at existing projects and the termination of a US pilot contract. For the full year, management guides for order intake between €550 million and €850 million, revenue of €450–550 million, and EBIT ranging from minus €30 million to minus €80 million.

Brussels throws a lifeline to steel. The beleaguered steel division is catching a regulatory tailwind. In mid-May, the European Parliament approved deep cuts to steel import quotas, reducing tariff-free volumes for certain categories to 18.3 million tonnes annually — a 47% reduction from previous levels — and doubling the safeguard tariff to 50%. The old rules were set to expire at the end of June. The "Steel and Metals Action Plan", adopted in the spring, is raising costs for Asian imports and should help stabilise pricing at Thyssenkrupp's Duisburg mills, buying time for the group's green steel transformation. CEO Miguel López is pressing ahead with the APEX efficiency programme, while the steel business is being groomed for eventual independence after halted talks with India's Jindal in early May.

Internal tensions simmer. López's radical restructuring is drawing pushback from within. Several insiders report growing resistance to the plan to spin off the Materials Services distribution business as a limited partnership with shares (KGaA). Meanwhile, the company's balance sheet remains solid: the equity ratio stands at around 36% and available liquidity totals €4.6 billion. Analysts see an average price target of €12.08, with Deutsche Bank at €14.50 and a "buy" rating.

The week ahead: Warsaw signals. On Tuesday, management will present further details of the transformation into a focused financial holding at a small-cap investor conference in Warsaw. If concrete milestones on the steel unit's restructuring and the broader demerger plans are unveiled, the stock could challenge the €12 level. Technically, the share has broken above the 200-day moving average and sits 9% above that line, with support at €10 now looking solid. A sustained push past €11.50 would confirm the trend, but the overbought RSI suggests a consolidation may precede any further gains.