TKMS Closes Out an Era of Israeli Submarine Deliveries While the Order Book Hits New Highs

The departure of the INS Drakon from Kiel marked more than just another handover ceremony. As the final vessel in the Dolphin-II class slipped its berth and set course for Israel, thyssenkrupp Marine Systems quietly closed a chapter that had defined its export ambitions for the better part of two decades. The Dolphin AIP programme, once the crown jewel of the Kiel yard’s underwater portfolio, is now officially complete — all three boats of the class delivered, the last one formally transferred to the Israeli navy.

The timing of that milestone was anything but incidental. It landed in the same week that TKMS put pen to paper on a memorandum of understanding with Italy’s Fincantieri, signalling an intent to deepen collaboration in the submarine segment. Both shipyards were at pains to stress that the arrangement involves no merger, no acquisition, and no disruption to existing national programmes. A binding framework agreement is expected to take shape by the end of the year.

That Italian overture follows a similar declaration of intent with Spain’s Navantia roughly a month earlier, under which TKMS would supply the design while Spanish yards handle production. Taken together, the two agreements sketch the outlines of a European naval network with TKMS positioned as the design and technology anchor — a role that could carry considerable weight as European capitals rethink their maritime procurement strategies.

A Backlog That Keeps Growing

The operational picture, meanwhile, remains robust. TKMS reported higher revenue and improved adjusted EBIT for the first half of its 2025/26 fiscal year, and the order book has reached a level the company describes as a record. After nine months of the current financial year, that backlog stood at €20.1 billion, according to media reports. Factor in the four MEKO A-200 DEU frigates worth €6.3 billion — a contract slated for recognition after the balance sheet date — and the total pushes past €25 billion.

That figure alone provides visibility stretching well beyond the current reporting period. But the potential upside does not stop there. TKMS is understood to be the preferred bidder for a Canadian submarine programme covering up to twelve boats, a project the company itself values at more than €15 billion. A win in Ottawa would add a structural growth driver on top of an already crowded order book — assuming the decision ultimately falls TKMS’s way.

Should investors sell immediately? Or is it worth buying TKMS?

The Market Looks the Other Way

For all that, the share price tells a different story. The stock closed Friday at €83.30, down 0.5 percent on the day. Over the past week, it has shed 7.6 percent, and the 30-day decline stands at 5.7 percent. That leaves the shares roughly 23 percent below their 52-week high of €108.80, reached on 14 August — though they remain up 26 percent since the start of the year.

The disconnect between the news flow and the tape is hard to miss. Neither the completion of the Dolphin programme nor the record backlog figures managed to arrest the slide. Market observers have pointed to profit-taking after a strong rally in recent months, and some commentary has linked the softer tone in European defence equities specifically to the Fincantieri move — a reminder that even positively framed cooperation announcements do not automatically translate into share price momentum.

What the recent headlines have not delivered is fresh financial detail. Neither the Drakon handover nor the Fincantieri memorandum came with updated guidance or new order values. Nor has there been a recent analyst assessment to recalibrate expectations; the €111 price target still circulating in some overviews dates back to an older survey and should not be mistaken for a current evaluation.

For shareholders, the operative message is nonetheless clear: one major construction programme has been delivered on schedule, while new international partnerships are being assembled in parallel. Whether that combination eventually moves the needle will depend less on last week’s already digested news and more on whether the promised Fincantieri framework materialises by year-end — and what, if anything, follows from Canada.