Jefferies initiated coverage of AlzChem Group AG with a 'buy' rating and a €190 price target, representing 23% upside from the current share price of €154.80. The German specialty chemicals producer is entering a 'multi-year acceleration phase' driven by capacity expansions in nitroguanidine and creatine, alongside a potential U.S. facility backed by the Department of Defense.

Jefferies projects revenue growing at a 12.5% compound annual rate from 2025 to 2028, reaching €804 million, while EBITDA is forecast to expand 18.7% annually to €193 million over the same period. The bank estimates earnings per share of €5.99 in 2025, rising to €9.69 by 2028. Alzchem is executing a €140 million expansion to double nitroguanidine capacity in Trostberg, Germany, with commissioning targeted for the second half of 2026.

The U.S. Department of Defense has made a conditional commitment of $150 million in non-refundable grant funding to fully finance a nitroguanidine facility on American soil, contingent on site selection by end-2026 and targeting completion by 2029. Jefferies called the site announcement 'a key catalyst for the stock in 2026.' The company's shift toward regulated, application-specific products across defense, human nutrition, pharma and agriculture has 'decoupled profitability from pure volume growth in basic chemicals,' according to the bank.