Daily Brief Industrials: Austal Ltd, Chiyoda Corp, Lonking, Xpo Logistics, Mastec Inc, Ingersoll Rand , Kazakhstan Temir Zholy, Lyntris, MARUKA FURUSATO and more

• This morning (11th August), Aussie-based shipbuilding and defense firm Austal Ltd (ASB AU)  announced loses at its US unit after failing to secure contractual relief (previously expected & booked).
• Concurrent with this trading update, Austal announced Hanwha, currently holding 19.9% in Austal (9.9% direct + 9.9% via swap), has made a US$1.05-2bn indicative Offer for this US unit.
• On balance,  I see Hanwha receiving the necessary regulatory approvals. The US secures a cashed-up ally to construct strategic vessels; and Canberra keeps the domestic ops in local hands. 

• Austal Ltd (ASB AU) disclosed a non-binding proposal from Hanwha Ocean (042660 KS) for Austal USA at an EV of US$1.05-1.20 billion, 1.1x to 1.2x of the Group’s pre-bid EV.
• Alongside the NBIO disclosure, Austal has provided a trading update noting significant non-cash provisions at Austal USA, resulting in an expected FY26 EBIT loss of A$175 million.
• Hanwha’s offer is attractive, and securing US approvals should not be an issue. Austal’s valuation remains compelling, with my SoTP valuation of A$5.95, a 32% premium to the last close.

• Chiyoda Corporation is a Yokohama-based engineering, procurement, and construction (EPC) contractor and one of only a handful of companies on earth capable of building a full-scale LNG liquefaction plant, alongside Bechtel, Technip Energies, and Japanese peer JGC Holdings.
• Two of its own joint-venture partners on its largest US LNG projects, McDermott International and Zachry Holdings, went bankrupt attempting the same work, thinning an already tiny global competitive set just as a fresh ~$90B wave of global LNG projects arrives.
• Chiyoda itself nearly went the same way twice, with a ¥214.9B net loss in FY2019 and a second solvency scare in FY2024, both triggered by cost blowouts on the same Golden Pass LNG project in Texas, and was kept alive only because controlling shareholder Mitsubishi Corp injected preferred-stock capital both times.

• The market is underestimating Lonking (3339 HK)‘s earnings, with consensus forecasts pointing to an 8.5% decline in 2H26. Instead, industry wheel loader sales grew 30.8% in Jul. 
• Its net cash surged 2.8x in the last ten years, and by end-FY26, it will reach Rmb8.2bn, or 73.9% of its current market capitalisation.
• FY26-28F average ROE will reach 12.4%, the highest in the last five years, justifying its 0.9x P/B. Ex-net cash, its FY25 ROE will instead be 23.5%.

• The latest quarterly results from XPO Logistics, Inc. demonstrate record-setting financial and operational performance alongside ongoing investments in capacity and technology.
• The company reported second quarter revenues of $2.4 billion, marking a 13% year-over-year increase, with adjusted EBITDA of $434 million, a 25% rise excluding real estate gains.
• Adjusted diluted earnings per share increased 56% to $1.64.

• MasTec Inc. reported second quarter 2026 results marked by solid year-over-year growth in key financial metrics and an expanded backlog.
• Revenue increased 23% to $4.374 billion, adjusted EBITDA rose 40% to $384 million, and adjusted earnings per share grew 49% to $2.22.
• The company also ended the quarter with a record backlog of $21.4 billion, reflecting strong demand momentum.

• Ingersoll Rand reported its second quarter and first half of 2026 results with continued execution strength and improving demand across its diverse markets.
• The company achieved 2% organic order growth and 4% organic revenue growth in the quarter, driving a 7% adjusted EPS increase year-over-year.
• Growth was broad-based, with every major region delivering positive organic revenue growth, and strong momentum was seen particularly in short- to medium-cycle businesses.

• Dominant State-Owned Monopoly with Strong Sovereign Support: Kazakhstan Temir Zholy (KTZ) is the national railway and logistics champion of Kazakhstan, operating as a vertically integrated monopoly. Its strategic importance to the nation’s commodity-driven economy and its role as a key transit hub between Asia and Europe ensure a very high likelihood of ongoing government support, underpinning its financial stability.
• Significant Growth Potential Driven by Transit Volumes and Modernization: KTZ is at the center of Kazakhstan’s strategy to enhance its role as a critical land bridge in the Eurasian corridor. Substantial capital investments are being made to modernize infrastructure and rolling stock, aiming to capture a larger share of the growing trade between China and Europe, particularly along the Trans-Caspian International Transport Route (Middle Corridor).
• Elevated Financial Risks Amidst Ambitious Expansion: The company’s aggressive capital expenditure program is leading to a significant increase in its debt load, with a substantial portion denominated in foreign currencies, exposing it to exchange rate volatility. While government support mitigates immediate liquidity concerns, the rising debt and the need to balance strategic investments with financial prudence are key challenges to monitor, especially with a potential IPO on the horizon.

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• Lyntris is targeting a $2.2-$2.5 billion valuation, leveraging exposure to growing defense spending and mission-critical technology across space, air, land and sea.
• The IPO is heavily secondary, with Trive Capital selling 19.1 million shares, representing 79.6% of the base offering and limiting primary capital raised.
• Strong Adjusted EBITDA growth and margins highlight improving financial performance, while the late-August debut faces a typically quiet IPO market backdrop.

• In 1H FY12/26, revenue rose YoY, driven by Machinery & Tools, despite declines in IoT Solution segment.
• Operating profit fell YoY due to increased SG&A expenses surpassing gross profit growth; Machinery & Tools, Construction Machinery, IoT Solution profits declined.
• Net income attributable to owners fell YoY; gains on asset sales were outweighed by operating profit decline.