Uppsala municipality reselected NYAB's joint venture as the general contractor for the Uppsala Tramway project

Translation: Original published in Finnish on 12/23/2024 at 07:16 am EET

On Friday, the company announced that Uppsala municipality had made a new decision to select NYAB, together with its partner Azvi, as the general contractor for the construction of the Uppsala Tramway. The process was related to the further assessment of the original decision by Uppsala municipality (see our latest comment here). The content of the decision remains in line with the original decision, which means that the joint venture between NYAB and Azvi has also been awarded an order for the first phase (more details here). In accordance with the Swedish Public Procurement Act, the order is subject to a 10-day appeal period, after which a contract can be signed. Therefore, possible new appeals cannot be completely excluded.

As we have previously stated, we see the impact of the first phase of the project for NYAB as rather limited relative to its overall size (revenue 2025e: 494 MEUR). However, with the confirmation that Phase 1 was successfully won, we believe that the selection of the joint venture for Phase 2 (estimated value around 440 MEUR) is also very likely, in line with company comments. If secured, Phase 2 of the project would also be quite significant for NYAB on a roughly annualized basis (4-5 years) (50% of the project 44-55 MEUR/year). Thus, if realized at the proposed scale, it would significantly support the company's growth strategy and our forecast of continued strong growth in the coming years (revenue 2026e-2027e: 539-574 MEUR). We take a positive view of the news, but at this stage it has no immediate impact on our estimates.