Buy Nordex and TKMS? What is going on between Siemens and Rock Tech Lithium?

Rock Tech Lithium: What is going on with Siemens? 

The European Union and Canada plan to significantly expand their cooperation on critical raw materials. The lithium industry in particular could benefit from this. At the end of October 2026, both sides agreed on a strategic alliance to accelerate investment in raw material projects and make supply chains more resilient. At the same time, Canada and the European Investment Bank (EIB) signed a framework agreement intended to enable the EIB to finance Canadian raw material projects in future. Lithium is a particular focus, as the raw material is needed for battery production and the expansion of electric mobility. This could open up new financing opportunities and sales prospects in Europe for Canadian lithium companies. However, no specific funding commitments for individual lithium projects have yet been announced.

Rock Tech Lithium could be among the potential beneficiaries of closer cooperation between the EU and Canada. The German-Canadian company wants to build a transatlantic lithium supply chain, relying on its own processing capacities in Canada and Europe. In Red Rock, Canada, Rock Tech plans to build a lithium converter to produce the key battery raw material lithium hydroxide. The company is also pursuing similar plans in Germany. The new raw materials partnership and the framework agreement between Canada and the European Investment Bank (EIB) could make it easier for Rock Tech to access financing in future. In addition, the company's strategy is aligned with the political objective of reducing dependence on Chinese lithium supply chains. However, the agreements do not yet constitute a specific funding commitment.

Rock Tech Lithium is also advancing its projects operationally. On September 22, 2026, the company announced specific agreements with Siemens Canada to further develop the planned lithium converter in Red Rock in the Canadian province of Ontario. This marks the first implementation phase of the strategic partnership agreed in March. Siemens is to develop a digital twin of the plant, allowing production processes to be simulated and optimised in terms of efficiency, energy consumption and operational safety even before construction. The technology group is also supporting Rock Tech with the ongoing definitive feasibility study (DFS), particularly in the areas of process control and automation. The study is due to be completed by mid-December 2026. In the long term, the cooperation could also be extended to other lithium projects in the G7 countries. Through the partnership, Rock Tech aims to combine German engineering expertise and Canadian raw material resources to build independent lithium supply chains. 

To expand its raw material base in Canada, Rock Tech Lithium launched an exploration programme in October at the approximately 9,875-hectare Victory lithium project in north-west Ontario. The focus is on two previously identified lithium deposits and a roughly 6 km long corridor between them, where further mineralisation is suspected. Historical rock samples showed lithium oxide grades of up to 5.11%. With the current programme, Rock Tech aims to gain new insights into the geological potential and define specific drilling targets for 2027. Initial results are expected early next year. Victory is strategically interesting as the project could provide an additional source of raw materials for the planned lithium converter in Red Rock in future. The existing infrastructure, with road and rail connections, is a positive factor.

Nordex: Analysts warn of cyclicality 

The analysts at mwb research have reiterated their Buy recommendation for Nordex. Following strong third-quarter 2026 figures, they believe the share price could reach EUR 47. The shares are currently trading at EUR 43. Nordex increased quarterly revenue by 28.2% to EUR 2.2 billion, while EBITDA more than doubled to EUR 278 million. 

The analysts view the development of order intake positively. In the project business, it rose 26% to EUR 2.5 billion. The service business grew even more dynamically, up 80.5% to EUR 518 million. Overall, the order book rose 30% to EUR 19.3 billion, giving Nordex a high degree of planning certainty for the coming quarters. In addition, the growing service business, with its recurring revenue, is expected to reduce dependence on the cyclical project business. Following its preliminary quarterly results, Nordex had already raised its full-year 2026 EBITDA margin guidance from 8.0–11.0% to 11.5–12.5%. This puts the guidance at the upper end of its medium-term target range of 10-12%.

Alongside the strong business performance, the analysts point to the continued high cyclicality of the wind power industry. Weakening demand following the current expansion phase could lead to lower capacity utilisation and weigh on margins. The growing service business should at least partially cushion these risks. For 2027, mwb research expects revenue to rise to EUR 9.86 billion and net profit to reach EUR 691 million. In 2028, revenue and net profit are expected to increase further to EUR 10.84 billion and EUR 794 million respectively. Analysts maintain a cautious view on the duration of the current upturn and therefore see only around 10% upside potential.

TKMS: News from India ignored

Rheinmetall's profit warning also weighed on TKMS shares last week. Although the naval specialist has not published any negative financial results, the stock was caught up in the fallout and lost more than 10% of its value within a few trading days. Investors apparently used the disappointment at Rheinmetall to take profits in other defence stocks as well. Yet TKMS's business model differs significantly from that of the Düsseldorf-based defence group. TKMS focuses on the construction of submarines and naval vessels, as well as maritime electronics. A positive company announcement on Friday was overshadowed by the weak market environment and could not halt the share price decline.

TKMS announced it had concluded a joint venture agreement with the Indian company CFF Fluid Control Limited. Together, the partners intend to establish TKMS CFF Defence Systems Private Limited. CFF will hold 51% of the shares, with TKMS holding the remaining 49%. The headquarters are to be located in Mumbai, while production and system integration are to take place at a dedicated facility in Chakan near Pune. The collaboration builds on a partnership established in 2023 and is intended to strengthen TKMS's position in the Indian defence market. The focus is on anti-submarine warfare technologies and other underwater defence systems.

The joint venture combines TKMS's sonar and sensor technology with the Indian partner's development and manufacturing capabilities. Local production, integration and long-term support of systems for the Indian Navy are planned. In doing so, TKMS supports the Indian government's "Make in India" initiative, which aims to advance the development of domestic industrial capabilities in the defence sector. Michael Ozegowski, Executive Vice President of TKMS ATLAS ELEKTRONIK, describes the agreement as the next step in the strategic partnership and reaffirms the long-term commitment to the Indian market. No financial details or specific order volumes were disclosed. For TKMS, the joint venture opens up the opportunity to position itself as a local technology partner for future Indian naval programmes.

Conclusion

TKMS currently looks anything but expensive. The order book is already packed, and further orders worth billions are in the pipeline. However, sentiment towards the sector is severely battered. Meanwhile, the situation for lithium appears to be improving. Fundamental demand in Europe is clear. Rock Tech Lithium is ideally positioned for cooperation between Canada and Europe. The collaboration with Siemens is also exciting. The stock has not yet reacted to this. Nordex currently has strong tailwinds. Analysts are right to point out the cyclical nature of the business, but this should not be overemphasised at present either.