Eutelsat Shares Under Pressure Following Equity Dilution

Eutelsat Group has successfully concluded a capital increase, raising gross proceeds of €670 million. However, the steep discount applied to the newly issued shares continues to weigh heavily on the stock's valuation. After declining more than 9% on Friday, the share price began the new trading week on a weak note, falling below the €1.90 threshold as investors digest the dilutive effects of the offering.

• Gross proceeds from the issuance totaled €670 million.
• The offering was significantly oversubscribed, with a subscription rate of 133%.
• The issue price for each new share was set at €1.35.
• Approximately 496 million new shares were issued.

A Bittersweet Financing Victory

This equity raise forms part of a larger €1.5 billion financing package. Major existing shareholders, including the French state (via APE) and Bharti Space Ltd., participated with additional direct investments. Management intends to use the fresh capital to reduce the company's substantial debt burden while simultaneously funding the expansion of its Low Earth Orbit (LEO) satellite constellation and the European IRIS² project.

The primary drawback for current shareholders was the deeply discounted issue price of €1.35 per share, which was substantially below the stock's trading level of over €2.00 prior to the announcement. This price differential triggered an immediate downward repricing of the existing shares.

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

Analyst Sentiment Shows a Glimmer of Hope

Despite the significant share price pressure, a slightly more positive outlook is emerging from analysts. On Friday, Deutsche Bank upgraded its rating on Eutelsat shares from "Sell" to "Hold." The bank's strategists cited a materially reduced risk of insolvency following the capital injection. Company leadership aims to lower its leverage ratio to 2.5x EBITDA by the conclusion of the 2025/2026 fiscal year.

Retail investors, however, remain cautious. The scale of the discount came as a shock to many, prompting immediate sell-offs.

Pivotal Trading Sessions on the Horizon

The newly issued shares are expected to begin trading on Euronext Paris this Tuesday, followed by admission to the London Stock Exchange on Wednesday. In the short term, this could introduce further selling pressure as arbitrage traders unwind positions and index funds adjust their portfolio weightings. From a technical analysis perspective, the €1.35 zone—matching the issue price—now represents a critical level of chart support.