TKMS: The €20.6 Billion Order Backlog That Still Leaves Room for Doubt
Published on 08/01/2026 at 11:01 | Redaktion boerse-global.de
When the Carlyle Group walked away from bidding on ThyssenKrupp's naval division in autumn 2024, the move barely registered beyond a footnote in the conglomerate's corporate routine. Less than two years later, the business that emerged from that process — now trading independently as TKMS — has become one of Europe's most sought-after defence equities, with a record order book that would have seemed unthinkable at the time of the carve-out.
The transformation has been swift. What began as an internal restructuring under the banner "Road2Independence" evolved into a stock market listing, and within a year, a place in Germany's MDAX index. But for all the momentum, the share price tells a more measured story than the headline numbers suggest.
A Record Backlog, a Persistent Gap
The financial figures underpinning TKMS's market position are striking. In its first standalone fiscal year 2024/25, net profit rose to €108 million from €88 million a year earlier, while order intake surged sixfold to €8.8 billion. The half-year report for 2025/26 pushed the order backlog to a record €20.6 billion, with revenue up 10 percent to €1.168 billion and adjusted EBIT improving from €53 million to €60 million.
Yet the stock has not fully kept pace with the order book. Shares closed Friday at €82.00, up 1.49 percent on the day, bringing the year-to-date gain to 23.87 percent. That still leaves the stock roughly a quarter — 23.06 percent, to be precise — below its 52-week high from late October. Deutsche Bank reaffirmed its "Buy" rating and €110 price target in late July, citing the high visibility provided by the record backlog, but the market has yet to close the valuation gap entirely.
Should investors sell immediately? Or is it worth buying TKMS?
Canada: Preferred Bidder, Not Yet a Contract
The central tension for investors lies in the distinction between preferred status and binding orders. In early July, the Canadian government selected TKMS as the preferred bidder for its Canadian Patrol Submarine Project, a programme covering up to twelve 212CD-class submarines with a potential value in the double-digit billions. Formal contract negotiations with Ottawa are now underway — but no firm order has been signed.
That gap between favouritism and signature is where the current share price story lives. Defence procurement of this scale depends heavily on political majorities and budget cycles, and the final step from preferred bidder to signed contract is often the most difficult stage in the entire process. Until that signature materialises, a portion of the current valuation remains, in effect, a bet on future payment streams rather than a reflection of secured revenue.
The competitive threat is real. Hanwha Ocean, the South Korean shipbuilder, had previously run an aggressive campaign to win the Canadian project for itself. Should Ottawa pivot to the Korean contender at the last moment, the premium currently baked into TKMS's share price would quickly evaporate.
Building a European Network
While Canada represents the largest single opportunity, TKMS has been quietly constructing a broader web of alliances. Late July brought a second memorandum of understanding with Spain's Navantia, deepening the strategic partnership in submarine construction and positioning both companies to jointly address NATO tenders. The hydrogen technology cooperation with Canadian partner GH Power, extended in the same period and explicitly tailored to the Canadian programme, also signals how defence exports and the energy transition are increasingly intersecting.
On the domestic front, the Bundestag's budget committee approved the procurement of four MEKO A-200 DEU frigates for the German Navy, with an option for additional units. Construction has been underway since February. The programme provides solid capacity utilisation for the shipyards through the end of the decade — though it also carries baggage. After the cancellation of the predecessor F126 project, TKMS can ill afford further delays on the new MEKO frigates.
India: The Next Catalyst
The most immediate potential catalyst sits in India. Under the country's Project-75I submarine programme, TKMS is considered the favourite to build six modern submarines. The German ambassador to India recently suggested a signing could come soon — possibly as early as August. A successful outcome would extend the company's capacity utilisation well beyond the current German frigate programme and could push the stock back toward last autumn's highs.
The timeline is tight. An extraordinary general meeting of parent company Thyssenkrupp is scheduled for August 7, and while TKMS trades independently, decisions on the conglomerate's restructuring could still have knock-on effects. The quarterly report follows on August 12, offering the next fundamental assessment of whether the Canadian potential, the Navantia partnership, and the frigate order are translating into the numbers.
TKMS at a turning point? This analysis reveals what investors need to know now.
The Technical Picture
Chartists are watching one level in particular: the 200-day moving average at €80.89. The current share price sits just 1.37 percent above that line. As long as the stock defends this support, the broader technical picture remains constructive. A sustained break below it would likely increase downward pressure.
The stock's volatility profile adds another layer of complexity. TKMS swings considerably more than the broader market, producing sharp moves in both directions. That cuts both ways: the same volatility that has driven the year-to-date gain could just as easily accelerate a decline if sentiment turns.
The strategic question for Europe is no longer whether fleets will be renewed, but who will build them. TKMS has repositioned itself in a matter of months from a conglomerate subsidiary to a partner of choice for multiple nations. Whether that translates into a durable competitive advantage depends on how many of these memorandums and preferred-bidder designations ultimately become signed contracts. The record order book suggests the foundation is solid; the gap between the share price and the backlog suggests the market is still waiting for proof.
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Disclaimer regarding our articles: No investment advice, no buy or sell recommendation. Information on prices, companies, and markets is provided without guarantee; changes are possible at any time. Stock market transactions can lead to substantial losses. Our articles are created and reviewed in whole or in part automatically with the support of AI.
