Almonty Industries: Rapid Expansion
Almonty Industries is exceptionally well positioned to benefit from the growing strategic importance of tungsten as a critical raw material. The supply shortage in a market largely dominated by China, Russia, North Korea, and Iran is expected to intensify further in the short term when the US import ban on tungsten from these countries takes effect at the beginning of 2027. Reflecting these supply concerns, the tungsten price surged above USD 3,000 per MTU during the first quarter.
As a producer whose largest asset is the Sangdong mine in South Korea, the company benefits from price increases and can expect phenomenal margins. With the second phase of production and full capacity, Sangdong is expected to meet approximately 40% of demand outside of China starting in late 2027. This provides the mine and the company with geopolitical clout.
Sangdong was designed for a low-price environment and can already operate profitably at a fraction of the current price. This underscores the potential for margins and cash flow. In addition, several offtake agreements guarantee attractive minimum prices.
The acquisition of a tungsten project in the US, completed last year, should be viewed as strategically important. Production is scheduled to begin in the second half of the year. This gives Almonty a foothold in an important market, allowing it to position itself as a local supplier and facilitate access to financing. In times of increasing geopolitical conflicts, the goal of secure supply chains, and the drive for independence from China in raw materials, this factor should not be underestimated.
With the recently issued convertible senior notes offering worth USD 800 million, Almonty has secured significant financial flexibility. Furthermore, the offering carries a favourable interest rate of 2.25% and matures in 2031. In addition to refinancing loans and covering general operating costs, potential acquisitions are on the agenda.
The company recently provided an update on drilling activities at the Sangdong molybdenum project in South Korea. Molybdenum is a strategic raw material for high-performance steels and special alloys and is used, for example, in the aerospace and defence industries, nuclear energy, and, increasingly, semiconductor and energy technology.
According to the company, just under 40% of the planned drilling program has been completed, with the latest data confirming historical results. Almonty is accelerating exploration against the backdrop of an acute molybdenum shortage in South Korea, after the country’s government called on companies to secure additional supply sources.
Aixtron: Consolidation at a High Level
Tungsten is also needed for the production of semiconductors. Tungsten hexafluoride, in particular, is used in chip manufacturing. This means indirectly, the expansion of AI infrastructure is leading to rising demand for this critical metal.
Aixtron is one of the world’s leading suppliers of deposition systems for the semiconductor industry and is benefiting from several megatrends. The equipment is used, among other things, in the production of power semiconductors, which are required in electric vehicles, data centers, industrial facilities, and telecommunications networks.
These growth prospects, particularly in the AI sector, have led to a spectacular share price performance, with the price having tripled since the beginning of the year. At the current price level of EUR 53, however, the majority of analysts consider the stock to be fairly valued. The experts at Jefferies are significantly more optimistic, with a price target of EUR 73, and emphasize the continuing strong order momentum. The company recently took advantage of the high share price to issue a convertible bond with a volume of EUR 450 million.
RENK: Negative Sentiment Weighs
RENK’s share price was unable to escape the recent correction in defence stocks. The trigger was market participants’ deep disappointment that the German federal government scrapped a hoped-for frigate purchase worth over EUR 10 billion from Rheinmetall. The defence contractor’s shares fell sharply to below EUR 1,000, reaching their lowest level since February 2025. Analysts significantly lowered their price targets, as Rheinmetall would now be unable to meet its previously announced earnings targets.
However, there are no fundamental reasons for the slide in RENK’s share price. It was merely a case of negative sentiment. As a specialty provider and key supplier, the company has strengthened its position. It develops transmissions, drive systems, and chassis components. At a current price of around EUR 43, RENK is valued at just over EUR 4 billion. On average, analysts see upside potential of around 60% for the stock.
Almonty has positioned itself perfectly in a highly relevant market where prices are set to rise in the long term. Tungsten is becoming increasingly important, and the supply situation continues to tighten. In addition, the company has another ace up its sleeve with the molybdenum project. With its well-stocked war chest, Almonty will create further value for shareholders through acquisitions. RENK has been caught up in the wave of sell-offs at Rheinmetall. Analysts now see upside potential of around 60%. At Aixtron, experts expect consolidation following the strong price gains.
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