Analysts and analyst reports

Kreate further strengthened its position in the Finnish infrastructure construction market by acquiring SRV’s Infra operations and adding also exposure to underground rock construction. The deal is quite decent sized, adding some 25% to group EBIT. EV of the deal indicates EV/EBIT multiple of 11.5x vs. Kreate’s own multiple 10.9x and the peer group’s multiple of 13.7x. Valuation is slightly above Kreate’s own multiples but on the other hand margins are also above Kreate. We believe that Kreate is able to find some synergies from the combination, supporting value generation in the coming years. Leverage of the company clearly increases (gearing to some 120%) but the more stable performance in the infrastructure construction market and quite good cash flow generation should quite rapidly lower indebtness. Slightly positive news.

Kreate announced to acquire SRV’s infrastructure construction operations, SRV Infra Oy. The EV of the deal totals EUR 30m, which will be paid in cash. Kreate will use its cash reserves and a new EUR 15m bank loan and also the revolving credit facilities are increased by EUR 5m. The operations had 106 employees. The completion of the transaction is subject to regulatory approvals. The parties expect the transaction to be completed by the end of 2025. The deal adds some 17% to Kreate’s sales and 25% to EBIT. We estimate that Kreate’s gearing will increase from around 58% level to around 120% after the deal.

SRV Infra Oy’s business consists mainly of underground rock construction and, to a smaller extent, foundation and special foundation construction. SRV Infra Oy’s revenue in 2024 was EUR 52.2m and its operating profit was EUR 2.6m (margin 5.0%) . In connection with the transaction, Kreate Oy and SRV Group Plc have entered into a long-term framework agreement concerning rock, foundation and concrete construction works related to building construction, as well as other infrastructure construction. The framework agreement covers all types of projects.

The acquisition complements Kreate’s offering well and the underground rock construction is a completely new construction area for Kreate in Finland.

Read the analyst reports:

• Q1 2026 analysis (27 April 2026)
• pre Q1 2026 analysis, incl. estimate changes  (13 Aprl 2026)
• Q4 2025 analysis (9 February 2026)
• Q3 2025 analysis (22 October 2025)
• Q2 2025 analysis (15 July 2025)
• Q1 2025 analysis (24 April 2025)
• Q4 2024 analysis (5 February 2025)
• Q3 2024 analysis (25 October 2024)
• Q2 2024 analysis (16 July 2024)
• Q1 2024 analysis  (26 April 2024)

All reports

Kreate’s growth will accelerate significantly this year as the company grows organically in both Finland and Sweden, supported by a strengthening order backlog. In addition, growth is boosted by the completed SRV Infra acquisition. We expect that through growth, the company’s profitability will return relatively closer to the level seen in previous years. Due to the recent positive order flow, we have also raised our growth estimates from 2026 onwards. However, the earnings-based valuation multiples for 2026-2027 have risen to a neutral level relative to our accepted valuation level. Thus, the risk/reward ratio is not attractive at this stage, considering the uncertainties related to earnings growth. Due to changes in our estimates, we raise our target price to EUR 12.5 (was EUR 11.0) but reiterate our Reduce recommendation.

A Finnish constructor specializing in demanding infrastructure
Kreate is a company specializing in demanding infrastructure construction, operating in Finland and Sweden. Kreate’s businesses are divided into Transport infrastructure construction and Structural engineering. Transport infrastructure construction includes the construction of railways, roads and streets. Structural engineering includes the company’s bridge construction and repair, foundation and civil engineering, special foundation construction (KFS Finland), and the Swedish operations. Following the acquisition of SRV Infra Oy, the company also has an underground rock construction business in Finland. Kreate has grown strongly in the recent past relative to the infrastructure construction market (2017-2024 CAGR ~10%), while profitability has been at a good level compared to the industry average (on average EBITA-% 3.9%). With a business model that ties up limited capital, returns on capital have also been strong.

Components for profitable growth in place for coming years
In its current strategy, Kreate aims for more moderate growth than before to support profitability development. Regarding growth, the company’s focus remains on the railway business and the Swedish business. In our view, in addition to focusing on profitability, the company is still well-positioned for strong growth, especially in the coming years. In addition to the acquisition, growth is supported by significant projects in the development phase, which we expect to move into the execution phase and thus be recorded in the company’s order book in the first half of 2026. In addition, we expect Kreate’s Swedish business to continue its profitable growth as the company expands into new types of construction and into the role of main contractor in the market. Kreate is targeting 5-10% growth during its current strategy period of 2024-2027. We expect the company to grow faster than its target, at an average annual rate of some 12%. Our profitability forecast remains below the company’s target level (target: EBITA-% >5%, 2027 forecast 4.2%). In our view, achieving the target level is possible in a single year, but the company’s efficiency would need to improve significantly to reach the target sustainably.

Valuation neutral compared to our updated forecasts
In our view, Kreate’s investment story in the coming years will primarily revolve around earnings improvement. In 2025, the company’s front-loaded personnel investments will continue to depress profitability. Due to the completed acquisition, it is justified to primarily examine the 2026 multiples, which fully account for the acquisition’s impact. Based on our estimates, Kreate’s share is valued at 11x EV/EBIT and 13x P/E multiples for 2026. Relative to our acceptable valuation (EV/EBIT 10-12x & P/E 10-13x), the pricing appears neutral. In addition, the valuation is broadly in line with peer companies (peer group median 2026e EV/EBIT 11x, P/E 14x). Looking to 2027, the multiples fall to a more attractive level (EV/EBIT 9x, P/E 10x). However, there is uncertainty regarding the realization of earnings growth due to factors such as the completed acquisition and the expansion of operations in Sweden. The DCF model value is roughly in line with our target price, supporting the recommendation.

Kreate extensive report (9 Jan 2026)

Kreate and SRV announced on New Year’s Eve that they had completed the SRV Infra Oy transaction. The completion of the transaction by the end of 2025 was expected, as the competition authority had already approved it in late November. The acquired company will be consolidated into Kreate as of January 1, 2026. The news has no impact on our estimates, as we already included the acquisition for both companies in October when the deal was announced.

Transaction completed as planned
SRV and Kreate announced that the acquisition of SRV Infra Oy was completed on December 31, 2025, with an enterprise value of around 30 MEUR as previously announced. SRV Infra’s revenue in 2024 was 52 MEUR, and its EBIT was 2.6 MEUR. SRV Infra’s business will be reported as part of Kreate Group’s Finnish structural engineering business as of January 1, 2026. SRV will record a sales gain of over 20 MEUR from the transaction. The transaction has no impact on either company’s guidance for 2025.

Measured by 2024 earnings, the purchase price is neutral (EV/EBIT 11.5x) and in line with the valuation level we accept for the sector (EV/EBIT 10-12x). However, we believe the multiple will decrease for 2025 due to SRV Infra’s improved margin accumulation last year.

The transaction seems logical for both the seller and the buyer
For Kreate, the acquisition expands the company’s offering to underground rock engineering, which is a new area for the company in Finland. The acquisition also strengthens the company’s position in foundation and special foundation construction. The long-term framework agreement with SRV, concluded in connection with the transaction, also provides stability and visibility for the coming years, reducing the risks of the acquisition. In addition, the acquired business is remarkably profitable and supports Kreate’s profitable growth in our estimates for 2026.

With the transaction, SRV strengthens its balance sheet and frees up capital to enable its targeted project portfolio structure. The company’s strategy focuses on increasing self-developed and -based housing and commercial construction, as well as strengthening building construction contracting. However, the transaction separates a unit whose earnings performance has been good in recent years from the Group. In our view, the transaction reduces the share’s risk level, considering the convertible bond maturing next summer.

Due to the limited overlap between the businesses, we expected the transaction to close as planned at the end of 2025. We therefore included the impact of the acquisition in our estimates already in October, and the news does not affect our estimates for either company.

Report (29 Oct 2025)

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