The arms company is worth twice as much on the stock exchange as it did before Russia attacked Ukraine. Business is booming. And the management does not expect a quick end to the boom.
The armaments group Rheinmetall is included in the leading German index Dax. Deutsche Börse announced this on Friday evening. The Düsseldorf-based company will replace the dialysis specialist Fresenius Medical Care AG in the first German stock exchange league from March 20th. FMC then descends into the index of medium-sized stocks, the MDax.
Rheinmetall currently has a market value of more than 10.8 billion euros. The share price has almost doubled since the Russian invasion of Ukraine a little over a year ago.
The current situation means good business for the group and its investors, said Rheinmetall boss Armin Papperger in an interview with “The Pioneer” published on Saturday. “I believe that in the next five years, maybe even longer, maybe ten years, there will be an insane need for security technology.” Europe has invested too little.
Business is booming
With around 29,500 employees, 15,000 of them in Germany, Rheinmetall is Germany’s largest armaments group. The company has added jobs over the past year. Business is booming. Germany has set up a special fund of 100 billion euros for the Bundeswehr. Papperger said that he feels investments of 200 to 300 billion euros are necessary for the Bundeswehr to be able to fulfill its task.
The company’s positive economic prospects are also due to increasing demand from other NATO and EU countries. A Rheinmetall spokesman recently said that Russia’s attack on Ukraine had intensified it again. “We have years of strong growth ahead of us.”
According to Papperger, Rheinmetall is negotiating with the government in Kiev about the construction of a tank factory in Ukraine. In the “Rheinische Post” (Saturday), the CEO spoke of a possible investment of 200 million euros. He hopes for a decision in the next two months.
German companies in the armaments industry are also striving for inclusion in the MDax: the armaments electronics manufacturer Hensoldt replaces the biofuel manufacturer Verbio. In addition, the technology group Jenoptik replaces Software AG. Verbio and Software AG are relegated to the SDax.
A few weeks ago, Commerzbank returned to the Dax. The return of Commerzbank was made possible by the withdrawal of the gas manufacturer Linde from the Frankfurt Stock Exchange.
Source: Stern
