First Berlin Equity Research has published a research update on 2G Energy AG (ISIN: DE000A0HL8N9). Analyst Dr. Karsten von Blumenthal reiterated his BUY rating and maintained his EUR 83.00 price target.

Abstract
2G Energy’s Capital Markets Day, held at its headquarters in Heek (North Rhine-Westphalia, Germany) in early October, was well attended and underscored the appeal of the company’s equity story. In addition to data centres, 2G’s strongest growth driver, the other growth drivers (mining, the German biogas market, German tenders for gas-fired reserve power stations, and the large-scale heat pump business) remain intact. The structural excess demand for gas-based energy supply solutions, economies of scale, the transition to industrial flow production and a rising share of service revenue in total revenue should roughly double the EBIT margin by the end of 2029E compared with 2025 (2029 FBe: 13.0% versus 2025: 6.6%). Historically, the service EBIT margin has been roughly twice as high as the EBIT margin in the New Plants segment. Based on strong revenue growth (CAGR 2025 – 2029: 26%) 2G should approach the €1bn revenue threshold by 2029E. This, combined with margin expansion, should increase EBIT ca. fivefold by the end of 2029E (2025: €26m, 2029E: €130m). A key aspect of the equity story is that 2G finances growth (investment in property, plant & equipment, working capital, as well as staff expansion) from operating cash flow, due mainly to substantial advance payments from customers. Increasing internationalisation and the expansion of the product portfolio are boosting the level of diversification and thereby reducing the risk of dependence on individual markets or products. This makes 2G an almost perfect growth story. The main risk is the timely processing of the full order books. 2G’s capacity is fully utilised until mid-2028. Final half-year figures, in which high free cash flow (€+30.2m) and a solid net cash position (€17.7m) stood out, confirmed preliminary results. An updated DCF model continues to yield a €83 price target. We confirm our Buy recommendation (upside: 88%).