European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

<ul>
<li>Indra's potential merger with Escribano aims to strengthen its industrial base for future European defense programs, but governance concerns and shareholder dilution risks are creating significant market uncertainty.</li>
<li>The transaction’s structure is critical: a pure share swap would preserve Indra’s balance sheet health, while a heavy cash component could raise leverage dangerously, approaching 3.4x net debt/EBITDA.</li>
<li>Event-Driven investors should de-risk ahead of the April 30 board meeting, monitor deal terms closely, and prepare to pivot based on the merger’s financing structure, governance safeguards, and strategic fit.</li>
</ul>


Indra's potential merger with Escribano aims to strengthen its industrial base for future European defense programs, but governance concerns and shareholder dilution risks are creating significant market uncertainty.
The transaction’s structure is critical: a pure share swap would preserve Indra’s balance sheet health, while a heavy cash component could raise leverage dangerously, approaching 3.4x net debt/EBITDA.
Event-Driven investors should de-risk ahead of the April 30 board meeting, monitor deal terms closely, and prepare to pivot based on the merger’s financing structure, governance safeguards, and strategic fit.


Building the Arsenal: Indra’s Possible Merger with EM&E

<ul>
<li>Indra is shifting to a pure-play defence and space company, divesting from IT services (Minsait) to achieve higher valuation multiples in line with aerospace and defence peers.</li>
<li>Hispasat and Hisdesat acquisition will generate €400 million in revenue and €190 million EBITDA by 2026, with synergies reaching €50-70 million EBITDA by 2030.</li>
<li>Indra’s valuation could rise 40-60% by 2026, as defence and space grow to 65% of revenue, increasing EV/EBITDA multiples from ~7x to 10-12x.</li>
</ul>


Indra is shifting to a pure-play defence and space company, divesting from IT services (Minsait) to achieve higher valuation multiples in line with aerospace and defence peers.
Hispasat and Hisdesat acquisition will generate €400 million in revenue and €190 million EBITDA by 2026, with synergies reaching €50-70 million EBITDA by 2030.
Indra’s valuation could rise 40-60% by 2026, as defence and space grow to 65% of revenue, increasing EV/EBITDA multiples from ~7x to 10-12x.


Indra’s Transformation into a Pure-Play Defence and Space Company

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass).</li>
<li>We will maintain our bullish view as long as market dynamics remain healthy and the SPX and ACWI-US are above 5700-5785 and $119-$121.</li>
<li>$123-$123.50 remains short-term support to watch on ACWI-US (6.5-month base); we would expect support here on a pullback, but a break below it would likely mean a test of $119-$121</li>
</ul>


We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass).
We will maintain our bullish view as long as market dynamics remain healthy and the SPX and ACWI-US are above 5700-5785 and $119-$121.
$123-$123.50 remains short-term support to watch on ACWI-US (6.5-month base); we would expect support here on a pullback, but a break below it would likely mean a test of $119-$121


Israel TA-125 Remains Bullish; Buys in Norway; All MSCI Global Indexes Above Base Supports

External reports (aggregated public sources), Value Investors Club

Value Investors Club

External reports (aggregated public sources)

Equity Bottom-Up

<ul><li>Indra Sistemas S.A. is positioned for success with increasing defense spending in Europe and growth in digital transformation services</li><li>Strategic focus on higher-margin Defense business and potential margin improvements in legacy IT segment expected to lead to significant margin expansion</li><li>Strong revenue growth, expanding profitability, robust order intake, and market leadership making Indra an attractive investment opportunity at an undemanding valuation.</li></ul><p><em>This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.</em></p>

Indra Sistemas S.A. is positioned for success with increasing defense spending in Europe and growth in digital transformation servicesStrategic focus on higher-margin Defense business and potential margin improvements in legacy IT segment expected to lead to significant margin expansionStrong revenue growth, expanding profitability, robust order intake, and market leadership making Indra an attractive investment opportunity at an undemanding valuation.This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only. This article was originally published 3 months ago on Value Investors Club.

Indra Sistemas Sa (ISMAY) - Friday, Aug 9, 2024

<ul>
<li>We remain near-term bullish since our 4/22/25 Compass, when we discussed that 5110-5120 on the S&amp;P 500 (SPX) was a bounce spot and a level to trade [long] against.</li>
<li>We'll maintain our bullish view as long as market dynamics remain healthy and SPX and ACWI-US are above 5500 and $115; we would be buyers on pullbacks to these levels.</li>
<li>We would also be buyers at 5700-5785 on SPX and $120-$121 on ACWI-US, which are shorter-term supports.</li>
</ul>


We remain near-term bullish since our 4/22/25 Compass, when we discussed that 5110-5120 on the S&amp;P 500 (SPX) was a bounce spot and a level to trade [long] against.
We'll maintain our bullish view as long as market dynamics remain healthy and SPX and ACWI-US are above 5500 and $115; we would be buyers on pullbacks to these levels.
We would also be buyers at 5700-5785 on SPX and $120-$121 on ACWI-US, which are shorter-term supports.


MSCI ACWI (ACWI-US) Testing All-Time Highs; Buy Pullbacks to $120-$121 or $115 Supports. Many Buys

Spain

Indra Sistemas, S.A. offers information technology products and services.  The Company offers systems integration and outsourcing services, installs railway management and ticketing systems, installs road traffic toll and signaling systems, constructs satellite communications systems, manufactures radar air defense systems, and installs insurance management systems.

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Indra Sistemas Sa (IDR SM)

Building the Arsenal: Indra’s Possible Merger with EM&E

Indra eyes Escribano to boost defense capabilities, but governance risks and potential dilution loom. Investors must watch April 30 for deal terms...

Jesus Rodriguez Aguilar

Indra’s Transformation into a Pure-Play Defence and Space Company

Indra is focusing on defence and space, divesting from IT services to increase valuation multiples and potentially see a 40-60% rise in valuation...

Jesus Rodriguez Aguilar

Israel TA-125 Remains Bullish; Buys in Norway; All MSCI Global Indexes Above Base Supports

Israel TA-125 Remains Bullish; Buys in Norway; All MSCI Global Indexes Above Base Supports $ACWI, $ACWX, ACWI ex-US Small-Caps, $EEM, and $EFA....

Vermilion Research

Indra Sistemas Sa (ISMAY) - Friday, Aug 9, 2024

Indra Sistemas S.A. is positioned for success with increasing defense spending in Europe and growth in digital transformation services

Value Investors Club

MSCI ACWI (ACWI-US) Testing All-Time Highs; Buy Pullbacks to $120-$121 or $115 Supports. Many Buys

MSCI $ACWI Testing All-Time Highs; Buy Pullbacks to $120-$121 or $115 Supports; Bullish Outlook Intact. Discussed Thursday pre-market that a...

Vermilion Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Building the Arsenal: Indra’s Possible Merger with EM&E

Indra eyes Escribano to boost defense capabilities, but governance risks and potential dilution loom. Investors must watch April 30 for deal terms...

Jesus Rodriguez Aguilar

Indra’s Transformation into a Pure-Play Defence and Space Company

​Indra is focusing on defence and space, divesting from IT services to increase valuation multiples and potentially see a 40-60% rise in valuation...

Jesus Rodriguez Aguilar

Israel TA-125 Remains Bullish; Buys in Norway; All MSCI Global Indexes Above Base Supports

Israel TA-125 Remains Bullish; Buys in Norway; All MSCI Global Indexes Above Base Supports $ACWI, $ACWX, ACWI ex-US Small-Caps, $EEM, and $EFA....

Vermilion Research

Indra Sistemas Sa (ISMAY) - Friday, Aug 9, 2024

Indra Sistemas S.A. is positioned for success with increasing defense spending in Europe and growth in digital transformation services

Value Investors Club

MSCI ACWI (ACWI-US) Testing All-Time Highs; Buy Pullbacks to $120-$121 or $115 Supports. Many Buys

MSCI $ACWI Testing All-Time Highs; Buy Pullbacks to $120-$121 or $115 Supports; Bullish Outlook Intact. Discussed Thursday pre-market that a...

Vermilion Research

Indra is focusing on defence and space, divesting from IT services to increase valuation multiples and potentially see a 40-60% rise in valuation...