Rheinmetall’s Two-Track Reality: A €350 Million Powder Bet and a Stock That’s Lost Half Its Value
Published on 07/23/2026 at 14:21 | Redaktion boerse-global.de
The ceremony in Aschau am Inn on July 23, 2026, had all the trappings of a company on a war footing. Rheinmetall CEO Armin Papperger stood alongside Bavaria’s minister-president Markus Söder and laid the cornerstone for a €350 million expansion of the group’s propellant powder plant. The message was blunt: without this facility, Papperger argued, NATO would not be combat-capable. Söder called it “the largest and most modern powder plant in Europe.”
Yet for all the fanfare, the stock tells a different story. Rheinmetall shares closed at €1,040.80 on the day of the announcement, up 2.62 percent, but that modest bounce does little to mask a brutal year. The equity has shed 32.96 percent since January, and at one point in June 2026 touched a 52-week low of €902.50. From the October 2025 all-time high of €2,007.00, the stock remains 48.14 percent below that peak — a correction that has erased roughly half the company’s market value.
The Firepower Programme and the China Dependency
The Aschau expansion is the centrepiece of Rheinmetall’s “Firepower” initiative, a group-wide push to lift total propellant powder capacity to 20,000 tonnes annually by 2030. The Bavarian site alone will see its output jump from 1,700 to 4,200 tonnes per year, with new production lines coming online in 2027 and full capacity expected by 2028. The workforce there is slated to grow from 800 to 1,300, with an eventual target of 1,400 employees.
Group-wide, Rheinmetall is pouring €650 million into powder production, spreading investments across Aschau, Wimmis in Switzerland, and two Spanish sites in Murcia and Burgos. Beyond raw powder, the Aschau plant will also produce more than one million propellant charge modules and over five million combustible cartridge cases annually.
Should investors sell immediately? Or is it worth buying Rheinmetall?
A key driver of this build-out is the urgent need to reduce reliance on Chinese nitrocellulose — the so-called “gun cotton” precursor essential to propellant manufacturing. Rheinmetall has acquired the German producer Hagedorn-NC, secured alternative supply lines in Turkey and the United States, and now holds a four-year inventory buffer. The company is also exploring wood fibre as a substitute for traditional cotton linters. The Aschau output will feed Rheinmetall’s own ammunition plants in Unterlüß, Lithuania, Latvia, and Hungary, with Ukraine identified as the single largest customer.
Papperger outlined ambitious targets for the broader munitions business: revenue is expected to climb from the current €3.5 billion to between €10 billion and €15 billion, with group-wide employment in the division reaching 60,000 to 70,000 direct jobs and roughly 300,000 positions across the supply chain. He also announced plans for a new competence centre near Munich focused on electronics, digitalisation, and artificial intelligence, staffed by 500 employees.
The Market’s Cold Shoulder
For all the operational momentum, the stock chart has turned hostile. The 200-day moving average sits at €1,503.38 — 32.64 percent above the current price — while the 50-day average of €1,121.44 also remains out of reach. The 30-day annualised volatility of 68.77 percent underscores how jittery trading has become. The Relative Strength Index at 43.6 points to a technically neutral but fragile position, with no clear oversold or overbought signal.
Over the past twelve months, the stock has fallen 43.18 percent. That is not a panic sell-off driven by bad news; it is the hangover from a staggering rally that saw Rheinmetall surge from below €83 in early 2022 to the October 2025 record. That three-year, twenty-fold-plus run was a sector-wide re-rating fuelled by Europe’s post-Ukraine defence pivot. Now the market is demanding proof that the operational performance can match the expectations already baked into the share price.
The market capitalisation has shrunk accordingly. At €46.57 billion, Rheinmetall remains a DAX heavyweight, but the figure also measures how much valuation has evaporated in recent months. The debate has shifted from whether European defence demand is structurally growing — that is largely accepted — to how much of that growth is already priced in and how much the company can actually convert into revenue and margin in the coming quarters.
Rheinmetall at a turning point? This analysis reveals what investors need to know now.
What Comes Next
Rheinmetall’s order book is expected to surpass €100 billion, and the group is reportedly evaluating a takeover of German Naval Yards. Plans are also advancing for a Bundeswehr procurement of more than 600 Skyranger air-defence systems worth over €9 billion. The industrial pipeline is full.
But the stock market has stopped cheering every headline. The days when any defence-sector news automatically triggered double-digit gains are over. For investors, the next catalyst will not come from a cornerstone ceremony or a political speech. It will come from quarterly earnings that show whether the powder, the modules, and the margins can close the gap between a €2,000 peak and a €1,000 reality.
Ad
Rheinmetall Stock: New Analysis - 23 July
Fresh Rheinmetall information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
Disclaimer regarding our articles: No investment advice, no buy or sell recommendation. Information on prices, companies, and markets is provided without guarantee; changes are possible at any time. Stock market transactions can lead to substantial losses. Our articles are created and reviewed in whole or in part automatically with the support of AI.
