Lubawa is a Polish special-equipment and technical-textiles group (bulletproof vests, camouflage/masking, fabrics, advertising materials) riding the multi-year Polish and European defense-spending buildout. Adjusted ROIC of 34.1% against an 8% WACC produces genuine value creation — +PLN 99m Economic Profit on a PLN 381m capital base — with FY2025 revenue PLN 616.7m (+20.9%) and Q1 2026 up +27.3% YoY.
The balance sheet is a fortress: debt-free, PLN 138m cash plus 175m in deposits, net cash of ~PLN 240m. That funds the order book without dilution and leaves M&A / capital-return optionality. Multi-year Agencja Uzbrojenia frameworks and the announced PLN 586m contract underwrite near-term backlog visibility.
The caveat is durability: technical textiles and special equipment are cyclical, and demand is concentrated in a single country and effectively a single buyer (MON procurement). The current 34% ROIC is a demand-cycle peak, not a durable franchise return — the moat is emerging (defense qualification) rather than entrenched, so this is a cheap cyclical, not a compounder.
At an enterprise value of PLN 1,541.8m against adjusted NOPAT of PLN 129.9m, Lubawa trades at 11.9x EV/NOPAT — inexpensive for a 34% ROIC, net-cash business growing 20%+. On through-cycle (not peak) margins the multiple is fuller, but even a modest re-rate plus the net-cash cushion supports upside from PLN 11.86.
Base PLN 14.0 (+18%) on a modest EV/NOPAT re-rate toward mid-teens as backlog converts and net cash is recognised; bull PLN 18.0 as contract wins land and 24% EBIT margins hold; bear PLN 8.5 if the defense cycle rolls over and margins normalise toward the high-teens.
At today’s enterprise value the constant-ROIC reverse-DCF maxes out: even at its sustainable-growth ceiling (~-50.0%, limited by ROIC 34% ≈ WACC 8%) it cannot reach the current EV. No-growth value is PLN 13,614/share (114789% of price); the market prices in growth and/or a higher ROIC than booked — richly valued on this lens. Read the sensitivity grid.
| Scenario | 24m target | Impl. g | Upside | Prob. | Driver |
|---|---|---|---|---|---|
| Bull | PLN 18 | ≥-50% | +52% | 30% | Contract wins land; 24% EBIT margin holds |
| Base | PLN 14 | ≥-50% | +18% | 45% | Modest EV/NOPAT re-rate; backlog converts, net cash recognised |
| Bear | PLN 8 | ≥-50% | -28% | 25% | Defense cycle rolls over; margins normalise to high-teens |
| Prob-weighted | PLN 14 | — | +17% | 100% | Scenario-weighted expected value |
| WACC \ g | 0% | 3% | 5% | 8% | 10% | 15% |
|---|---|---|---|---|---|---|
| 6.50% | 18,577 | 20,942 | 22,661 | 25,469 | 27,503 | 33,207 |
| 7.25% | 15,705 | 17,622 | 19,013 | 21,281 | 22,921 | 27,506 |
| 8.00% (base) | 13,614 | 15,208 | 16,363 | 18,240 | 19,596 | 23,375 |
| 8.75% | 12,023 | 13,374 | 14,350 | 15,934 | 17,075 | 20,248 |
| 9.50% | 10,772 | 11,933 | 12,770 | 14,126 | 15,100 | 17,802 |
Green = fair value above the current price of PLN 11.86. The reverse-DCF conclusion is dominated by WACC and growth — see the whole surface, not a single fair value.
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Adjusted ROIC 34.1% vs 8% WACC with a debt-free, PLN 240m net-cash balance sheet — genuine capital efficiency.
Polish/NATO budgets create structural multi-year demand for special equipment and defense fabrics.
Announced large contract plus multi-year Agencja Uzbrojenia frameworks give near-term revenue visibility.
11.9x EV/NOPAT for a 20%+ grower with net cash — a real valuation gap if margins hold.
Idle net cash could fund dividends, buybacks or bolt-on M&A once a policy is articulated.
Lubawa pairs elite current returns (34% ROIC, +PLN 99m EP) and a net-cash balance sheet with a cheap 11.9x EV/NOPAT and 20%+ growth — a genuine value-plus-growth setup on the Polish/European defense buildout. BUY, medium conviction; base target PLN 14.0 (+18%).
Conviction is capped by cyclicality and single-buyer concentration: the moat is emerging, not durable, and the return is a cycle peak. A stated capital-return policy for the net-cash pile, or evidence margins hold through an order lull, would support an upgrade.
Every adjustment traces to the cited note/page in the source filing — click to open it there. Latest interim: 📄 open
| Adjustment / figure | Value | Source | Why mttssn treats it this way |
|---|---|---|---|
| LTM revenue (FY2025 616,736 - Q1'25 107,620 + Q1'26 136,964 = 646,080) | 646,080 | Consolidated statement of comprehensive income p.5 (FY) + Q1 report p.6 | LTM revenue rebuilt from FY anchor and both Q1 periods; defense/textiles-driven +27% Q1 YoY. |
| Reported operating profit EBIT (LTM 160,368) | 160,368 | Wynik z działalności operacyjnej, IS p.5 (FY) + p.6 (Q1) | Reported EBIT taken as adjusted EBIT — no restructuring, impairment or one-offs found; company discloses no adjusted-EBIT APM. |
| Total equity 612,138 (parent 611,641; NCI 497) at 31.03.2026 | 612,138 | Skonsolidowane sprawozdanie z sytuacji finansowej, Q1 report p.4 📄 p.4 | IC snapshot uses latest interim balance sheet; equity_ex_oci after stripping 2,793 reserve. |
| Cash 61,689 + other short-term financial assets (deposits) 180,000 at 31.03.2026 | 241,689 | Środki pieniężne + Inne krótkoterminowe aktywa finansowe, BS p.4 📄 p.4 | Debt-free, cash-rich; 180m bank deposits treated as excess (non-operating) cash and stripped from IC. |
| Interest-bearing debt 41; lease liabilities 2,536 at 31.03.2026 | 41 | Kredyty, pożyczki i inne zobowiązania finansowe + Zobowiązania z tytułu leasingu, BS p.4 📄 p.4 | Essentially unlevered; leases office/vehicle, excluded from IC. |
| Capitalised R&D (completed development costs) net 12,684; FY2025 amortisation 4,884 | 12,684 | Aktywa niematerialne note (Note 2), intangibles roll-forward | R&D-cap-rate modest; carrying asset kept on balance sheet, amortisation kept in opex — no adjustment. |