Rheinmetall could be worth 17 billion euro over medium term-CEO

[June 10, 2023]   BERLIN (Reuters) - The CEO of Germany's largest defence contractor Rheinmetall said he expected a further boost to the company's stock market value due to the Ukraine war and increased defence spending in Europe.

The logo of Rheinmetall is seen at a production line of German company Rheinmetall, which produces weapons and ammunition for tanks and artillery, during a media tour at the company’s plant in Unterluess, Germany, June 6, 2023. REUTERS/Fabian Bimmer

"Our operating income in 2025 should be about 1.5 billion euros ($1.6 billion), maybe even 1.7 billion euros. For a fair valuation, multiply that with a factor of 11 or 12. That gives you an order of magnitude," CEO Armin Papperger told German newspaper publisher RND in an interview published on Satursday.

"A valuation of 17 billion euros is realistic for Rheinmetall over the medium term," he added.

Rheinmetall's current stock valuation is about 10.5 billion euros, on 2022 operating income of 754 million euros.

The stock market value of the company, a maker of tanks, ammunition and other war equipment, has tripled since December 2021 and it joined Germany's blue-chip DAX index earlier this year.

($1 = 0.9305 euros)

(Reporting by Christian Kraemer, Holger Hansen, Writing by Sabine Siebold; Editing by Kirsti Knolle and Madeline Chambers)

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