Incap: A cautious view on the EMS sector in H1 2025 - Nordea

We believe that the company's revenue growth of 40% y/y and record-high EBIT margin of 15% in Q4 2024 were not enough for investors. Incap expects a slow start to 2025, prompting the share price to fall by 9% on 28 February. The main reason for its cautious view is geopolitical uncertainty, which could impact supply chain logistics, inventory levels and end demand in the short term. We trim our revenue estimates, but continue to believe that the company is aiming for more than 10% revenue growth in 2025. Our fair value range remains at EUR 12.1-14.8, based on our DCF analysis and backed by a peer group comparison. Incap's 2025E EV/EBIT is currently 31% below the peer group median. Marketing material commissioned by Incap.

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