Renk’s Record €7bn Order Book Fails to Shield Stock From Index Exit and KNDS Overhang

Renk's shares near 52-week low despite record €6.9bn backlog as KNDS IPO and index removal pressure stock. Operations strong, targets 2030 growth.

The defence gear specialist Renk is living a tale of two realities. Its order backlog sits at a historic €6.9bn, new business is surging, and management is busy unveiling a fresh investor-relations push to keep growth ambitions in focus. Yet the stock is in freefall, closing Wednesday at €42.57 after a 7.25% rout that puts it within a hair’s breadth — just 1.1% — of its 52-week low of €42.12. Since the start of the year, the shares have shed roughly a quarter of their market value, a slide that market-watchers attribute less to the company’s operations than to a confluence of technical and sector-specific forces.

The biggest near-term drag is the looming initial public offering of rival defence group KNDS. Institutional investors are reportedly selling down Renk positions to raise cash for the upcoming debut, squeezing a stock that has been a favourite among European defence names since its own IPO in 2024. A second technical blow landed on 22 June, when Renk was removed from the iSTOXX Europe Centenary Select 30 Index. Passive funds tracking the benchmark were forced to unload their holdings, adding further selling pressure. The result is a chart that has turned deeply bearish — the shares now trade more than 25% below their 200-day moving average, while the relative strength index at roughly 34 signals a condition close to oversold.

None of this reflects the operational picture. Renk recorded its strongest ever start to a financial year in the first quarter, with order intake climbing to €582m and pushing the total backlog to the record €6.9bn. The adjusted EBIT margin improved to 15%, while adjusted operating profit reached about €42m, underscoring that the business is firing on all cylinders. Growth is being driven by demand for vehicle-mobility solutions, where order intake rose more than 20% and the segment margin improved visibly to 18.3%. Recent successes include a propulsion contract for an unmanned surface vessel for a NATO navy and the joint presentation with partner Patria of a heavy autonomous ground vehicle at the Eurosatory defence exhibition.

Management is not leaving the stock’s underperformance unanswered. This Thursday the company launched a new investor-communication format, with senior manager Christian Weiss placing strategic positioning front and centre. The aim is to restore credibility for the long-term growth story: by 2030, Renk targets organic sales of around €3bn and an adjusted operating margin above 20%, supplemented by bolt-on acquisitions in defence. For the current year, the group expects revenue of over €1.5bn and adjusted operating profit between €255m and €285m — targets that, if met, would provide the strongest counter-argument to the bearish sentiment. Investors will get the next concrete numbers on 16 July, when management hosts a pre-close call for the first half of the year. A break of the year-low support level, however, could trigger further selling, making the coming weeks critical for the stock’s near-term direction.