Indus Lowers Earnings Prediction Leads to Stock Price Decline
Indus Drops 2025 Business Forecast Amid Trade War Fallout
Indus, the European firm specializing in acquiring mid-sized businesses, has taken a hit due to the escalating U.S.-initiated trade war. The company announced a downgraded forecast on Wednesday, with revenue projected between €1.7 and €1.85 billion this year—a noticeable dip from the earlier estimation of €1.75 to €1.85 billion in March. The adjusted operating result (EBITA) now stands between €130 and €165 million, a significant drop from the previously forecast €150 to €175 million. The adjusted EBITA margin is expected to range between 7.5% and 9.0%.
This grim news sent Indus' stocks tumbling at Thursday's market opening. The share took a steep dive, losing over 8% to €22.80, landing at the bottom of the SDAX.
According to Indus, the disruptive U.S. trade policy is causing particular turbulence for its participations in the Materials Solutions segment. In a cruel twist, China expanded its export controls in February 2025 to include essential materials like tungsten and tungsten compounds. This regulatory crackdown primarily impacts Betek, a key participant in Indus' portfolio, which imports substantial quantities of tungsten-laden precursors from China.
Despite these challenges, Indus,listed in the small-cap index SDAX, plans to unveil its first-quarter 2025 financial report as scheduled on May 14.
Trade tensions and economic forecasts can have a profound impact on businesses such as Indus. U.S.-China trade disputes have disrupted global trade by increasing tariffs and supply chain disruptions. This can drive up production costs, reduce demand, and instill uncertainty among businesses involved in international trade.
The Materials Solutions segment could be vulnerable to these tensions if it relies on materials sourced from countries embroiled in trade conflicts. Higher tariffs and supply chain disruptions may increase costs and compromise production for these segments. Similarly, segments that rely on international trade could face challenges, as they grapple with increased costs and potential shortages of critical components.
Companies might need to revise their forecasts due to thesepressing market conditions. In response, businesses might adjust their strategies to mitigate risks, such as diversifying supply chains, investing in cost-saving technologies, or focusing on domestic markets. For specific insights into Indus and its segments, consulting company-specific reports or news releases is recommended.
- The disruptive U.S. trade policy has caused significant turbulence for industries like finance and business, as evidenced by Indus' downgraded 2025 business forecast amid the trade war fallout.
- The Materials Solutions segment, a part of Indus' business, could be particularly vulnerable due to its reliance on materials sourced from countries embroiled in trade conflicts, prompting companies to revise their forecasts and adapt strategies to mitigate risks.
