Astor 3Q25 results: We view Astor’s 3Q25 results as broadly in line, as softer operations were expected. The delayed ramp-up of the new production facility led us to trim our near-term estimates, but we expect a clear recovery in 2026 once the plant becomes fully operational. Strategic expansion in the U.S. and potential project wins in Ukraine might provide meaningful medium-term upside. We cut our 2025 revenue forecast by 7% to US$852mn (+13% y/y), in line with the Co.revised guidance. For 2026, assuming a 60% utilization rate at the new facility, we lowered our revenue estimate by 10% to c.US$1.1bn (+26% y/y). EBITDA assumptions were reduced by 7%
for 2025 and by 12% for 2026, mainly reflecting domestic price competition while lower energy costs, in-house copper wire production and the scale benefits of the new facility support stable EBITDA margins of c.32% for both years. Despite the rise in peer group multiples, we increased the discount applied to target multiples to 40% (from 30%) to reflect Astor’s developing stage vs established global players. Combined with our downward estimate revisions, our target price declines by 9% to TL190.8, implying 104% potential upside. We maintain Overweight rating.
Key Highlights: U.S. remains Astor’s key strategic market, offering higher margins.
Management highlighted that the U.S. sales order could reach US$100-150mn by yearend,
supported by accelerating AI-driven data center investments. The company has already secured the necessary certifications for local operations and is evaluating a small-scale U.S. production facility with an initial CAPEX of c.US$100mn. Meanwhile,
management also noted that Ukraine may offer additional upside through potential reconstruction contracts over the coming years.
Recap of 3Q results: 3Q net income of TL2,745m, indicating a y/y -1% in real terms
(higher than our estimate of TL1.1bn), driven by higher FX gains from financial investment & funds and low effective tax rates. Quarterly revenues declined by 7% y/y in 3Q25, broadly in line with our estimate. Export sales share reached to 46% in 9M25.
(vs 38% in 9M24). Gross margins declined by 4ppts to 43.1% driven mainly due to price competition in distribution transformers in the domestic market. Opex/sales ratio increased slightly from 8% in 3Q24 to 9% in 3Q25. As such, EBITDA declined by 17% y/y to TL2.5bn (vs our estimate of TL2.6bn) and EBITDA margin declined by 4ppts to 32.8%
in 3Q25. TL2bn positive investment income from VC fund revaluation from fixed equity investments partially offset by higher monetary losses, leading to PBT to TL2.9bn (-9%
y/y). 9M25 financials shows that net sales with US$534mn, EBITDA with US$174mn, of 32.5% EBITDA margin.
FY25 guidance revised down… Astor revised its FY25 revenue guidance down to US$853mn (down by 9% from US$940mn), implying +13% y/y growth. Management did not provide FY26 guidance, citing a cautious stance until the full commissioning of its new plant. As of 9M25, backlog orders stood at US$786mn, up by 2% q/q (62%
international, 38% domestic), with the product mix comprising 81% power transformers, 10% distribution transformers, and 9% switching products.
Valuation: We reduced our TP by 9% to TL190.8 (from TL209.7), implying 104%
potential upside, as the increase in peer-group multiples partially offsets downward revisions in our estimates. We value Astor using a 50% DCF / 50% EV/EBITDA blended approach. Our target multiples assume 11.8x and 9.7x 12M forward EV/EBITDA for 2025 and 2026, respectively, reflecting a 40% discount to global peers. We maintain Overweight rating.
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