Alfa Laval (Buy, TP: SEK565.00) - Pumped and profitable
We are 2–4% below consensus on Q1 orders, sales and adj. EBITA, and expect the Q2 demand guidance to be “somewhat lower” QOQ due to Marine. Despite a 2025e Marine organic order decline of c20% YOY, we expect the division’s margin to gradually improve through the year as the high-margin pumping systems backlog is executed (driving 20% YOY growth in group adj. EBITA). We reiterate our BUY, but have cut our target price to SEK565 (590), having lowered our 2025–2026e adj. EBITA by c4–5% on FX moves.Alfa-Laval AB is a supplier of products and solutions in the technologies of heat transfer, separation and fluid handling. Co.'s equipment is used to heat, cool, separate and transport products in industries that produce food, beverages, fuel, chemicals, pharmaceuticals, starch, sugar and ethanol. They are also used aboard vessels, in power plants, in the engineering industry, for treating sludge and wastewater, for heating and cooling, and others. Co.'s products include: air heat exchangers, plate heat exchangers, shell-and-tube heat exchangers, thermal fluid systems, boilers, decanters, belt filter presses, high-speed separators, membrane filtration, pumps and valves, and tank equipment.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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