The key pillars supporting our investment thesis are as follows:
Record Order Balance and Revenue Visibility: The company's order balance of US$786 million, reached as of the third quarter of 2025, largely secures its revenue stream for the next 12-18 months. The fact that 81% of this balance consists overwhelmingly of high-value-added power transformers supports the sustainability of margin quality.
Export-Focused Growth and Foreign Currency-Based Revenue: Despite the risk of contraction in the domestic market, the company's strategy to increase its export share to 50% is working successfully. The increase in the share of exports to 46.1% in the first nine months of 2025 provides the company with a natural hedge against volatility in the Turkish Lira. This allows us to normalize the Exchange Rate Risk Premium in our valuation model.
Capacity Increase and Economies of Scale: New factory investments and capacity increase projects in the Ankara ASO 2nd Organized Industrial Zone increase the company's competitiveness with its global competitors (Siemens, Hitachi, Schneider) and strengthen operational leverage by reducing unit costs.
Transformer manufacturers worldwide are facing an unprecedented surge in demand. There are three primary reasons for this:
Grid Aging and Modernization: The average age of electricity grids, particularly in the US and Western Europe, is over 40 years. These grids are unable to handle modern loads (electric vehicles, heat pumps), and a comprehensive renewal cycle has begun. This cycle represents a major export opportunity for companies like ASTOR, which can produce to IEC and IEEE standards.
Renewable Energy Integration: Wind and solar power plants, by their nature, generate intermittent power and are typically located far from consumption centers. Transporting this energy and maintaining voltage requires a much larger number of transformers than conventional power plants. Each MW of solar energy investment requires an investment in transformers with a certain MVA capacity.
Artificial Intelligence (AI) and Data Centers: The energy consumption of hyperscale data centers is increasing exponentially. These facilities require massive power transformers to draw high-voltage power from the grid and reduce it to a voltage suitable for the servers. Globally, lead times for these products have increased from 12 months to over 60 weeks. ASTOR, with its integrated manufacturing facility and flexible capacity, provides a competitive advantage by shortening these lead times.
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