* Q2 volumes pre-announced, we forecast sales -13%, EBIT -28%
* Comps ease from Q3, both FX and volumes should turn into tailwinds
* We cut '26e EBIT by 4%, but raise '27e-'28e by 2-6%
Q2 expectations
SinterCast's H1 production update effectively pre-announced the Q2 volume data: annualised series production of 3.2m (3.4m) engine equivalents, sampling cup shipments of 50,800 (58,050) and installation revenue of SEK 0.8m (2.1m). We estimate this will result in Q2 sales of SEK 27.2m (31.1m), down 13% y-o-y, where the weaker USD still remains a headwind. We forecast an EBIT margin of 30.1% (36.3%), with the earnings decline driven by lower volumes and FX; as usual, hedge revaluations are a swing factor.
Estimate changes
We cut '26e EBIT by 4%, aligning our estimates with the disclosed H1 data. However, we raise '27e-'28e EBIT by 2-6%, as updated FX rates more than offset a somewhat slower assumed ramp of the upcoming programme launches. We expect both FX and organic volumes to turn from headwind to tailwind in Q3.
Outlook and valuation
The H1 update showed series production regaining 15% vs. H2'25, driven primarily by Europe (+27%), confirming H2'25 as the trough. Furthermore, the July announcement that longstanding licensee Ironcast will supply CGI cylinder blocks for a new 13-litre North American CV platform (SOP late '26) lends additional support to the launch pipeline underpinning our '27e-'28e growth estimates; the company forecasts the combined programme could add around 13% to current series production at mature volumes. The share is currently trading at 24x/14x '26e/'28e P/E, vs. its historical median of 22x/15x. The Q2 report is due at 08:00 CET on 19 August.