CAF to supply Metro Madrid 40 trains for €400 million

brazil metro line

Intermoney | CAF (Buy P.O. €42) informed the National Securities Market Commission (CNMV) on Monday that it had reached an agreement with Metro Madrid, for the supply of the first of the two lots that make up the operator’s investment in the renewal and expansion of its fleet. The contract consists of 40 single-voltage gauge trains for lines 6 and 8 of the network and is worth around €400 million.

The collaboration between CAF and Metro de Madrid has been historically intense, with the majority of the fleet currently running on the capital’s suburban network manufactured and supplied by CAF, a total of more than 600 units. The last ones delivered were in 2010 and 2011.

Assessment: Positive news for CAF, as the size of the contract is quite considerable, almost 3% of the portfolio, which currently exceeds €14bn, with order intake at this stage of the year at around €1bn. They expect to grow +10% in revenues this year and improve their EBIT vs. 2023. By 2026 they expect to reach sales of €4.8bn (+25% vs 2023), EBIT of €300mn (+67% vs 2023) and keep debt at around 2.2x EBITDA. We maintain our buy recommendation with a P.O. of €42/share.

About the Author

The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.