海德堡材料资本市场日指引符合预期，但我们希望在投资组合轮换策略上有轻微转变

F25E15.130 May 2025172.45185.00191.05/85.601,432.5931,22538,4546M45.816.129.706/2512001300140015001600 RatingMarket-PerformPrice TargetHEI.GYReported EPSF24AHEI.GY (EUR)9.87OLD--Source: Bloomberg, Bernstein estimates and analysis.Heidelberg hosted their Capital Markets Day at the world’s first zero-carbon cement plant inBrevik, Norway on 27thand 28thMay. In this note we highlight our key takeaways from theCMD, update our model to reflect the extended guidance, compare how Heidelberg preformedvs their previous CMD targets and assess how this new strategy compares vs peers.Margin expansion potential from decarbonisation:Heidelberg highlighted ~20-30%EBITDA margin expansion potential from the Brevik plant from price premiumisation andlower costs. We are quite encouraged to see the demand start to pick up for decarbonizedcement which should allow a handsome price premium. The Brevik plant has excellenteconomics due to the opex and capex subsidies, however, the economics of Brevik cannotbe extrapolated to future CCS plants, because the subsidies might not be as lofty. We wouldhave preferred to have better disclosure on the true economics of CCS without subsidies.Capital allocation:The new capital allocation includes €7.8bn of capex, bolt-on M&A of€5-6bn and dividends and buybacks of €5-6bn over 2025E-30E. Baking this in, we seeleverage declining from 1.2x in 2024A to 0.1x by 2030E. This implies that to get to 1.5xleverage, Heidelberg have excess headroom of ~€10bn by 2030E. This leaves significantheadroom for large scale M&A and potentially higher cash returns to shareholders.Portfolio rotation:We would have liked to see a portfolio rotation strategy, exitingunderperforming markets and making a commitment towards certain businesses moreaggressively, such as stronger CCS ambitions. One of the primary reasons of our MP thesison Heidelberg is their exposure to some less attractive markets. We had hoped there wouldbe some slight shift in strategy and that management would not shut the door on options.Investment ImplicationsWe recently initiated on Heidelberg with a Market-Perform rating. This is based on ourproprietary fundamental market attractiveness model where we find Heidelberg stillexposed to some geographies which we deem less attractive. This CMD does not answerkey questions on portfolio rotation, especially exiting difficult markets and potential areasof expansion, which would have made us more constructive on the name. Therefore, wemaintain our MP thesis and slightly increase our PT to €185/share.See the Disclosure Appendix of this report for required disclosures, analyst certifications and otherimportant information. Alternatively, visit our Global Research Disclosure Website.First Published: 03 Jun 2025 05:00 UTC Completion Date: 02 Jun 2025 12:53 UTC CAGR----Close DateEDMFYEDiv YieldEV (EUR) (M)PerformanceAbsolute (%)EDM (%)Relative (%)€200€180€160€140€120€10006/24 185.00 EUR(180.00OLD)F26E13.1214.37FinancialsRevenues (M)EBIT (M) F25E11.3911.79F24AF25EF26E21,15722,04823,5122,7693,1743,546F26E13.17%Dec1.9%12M82.811.271.6 DETAILSHeidelberg hosted their Capital Markets Day at the world’s first zero-carbon cement plant in Brevik, Norway on 27thand 28May. In this note we highlight our key takeaways from the CMD, update our model to reflect the extended guidance, comparehow Heidelberg preformed vs their previous (2020 and 2022) CMD targets and assess how this new strategy compares vsexpectations and vs peers.Overall, Heidelberg’s CMD guidance in line with expectations, but we would have liked a slight shift in strategy on portfoliorotation. We maintain our Market-Perform rating on Heidelberg and raise our price target slightly to €185/share driven by thelower capex and bolt-on acquisition investments which are offsetting the impacts of the lower EBIT growth and slightly higherWACC of 10.7 vs 10.6.HEIDELBERG CMD HIGHLIGHTSCMD TARGETSHeidelberg provided guidance until 2030 for major parameters such as ROIC, RCO (EBIT) growth and CO2section we compare the targets vs consensus and our expectations.RCO:7-10% growth p.a. until 2030.ROIC:~10% in 2025 and ~12% by 2030; we are assuming ROIC increasing from 9.6% to 12.4% by 2030.Emission reduction:Specific CO2 <400kg CO22024. Heidelberg are also targeting >50% of revenues from sustainable products, to achieve >50% share of alternative fuels(vs 45% previously) and clinker incorporation rate of 64% (vs 68% previously).Capex:Heidelberg are guiding to ~€1.3bn of capex p.a. including the capex remaining to be spent on Brevik and that on theupcoming Padeswood CCS plant in Wales, UK (FID expected in the next 6 weeks).Leverage ratio:Heidelberg is generating significant amount of cash and as per estimates prior to this CMD, consensusexpected leverage to decrease from 1.2x in 2024A to 0.1x by 2030E. We have assumed Heidelberg continue acquisitions ata steady state run-rate of ~€0.9bn over 2025-28E. Therefore, our leverage ratio is higher than consensus at -0.4x by 2030E.Des