Amaero (ASX:3DA) is an emerging supplier of high-value refractory and titanium spherical powders including niobium C103 and Ti64, most of which are used in defence and aerospace applications. The company has also developed capability in parts manufacture. The company commissioned a commercial plant in Tennessee in 2024. Amaero aims to be the largest and lowest cost US domestic producer in its space, at a time when the US is investing significant resources to become the new ‘Arsenal of Democracy’.

A leading technology position in making powders

Refractory alloys are critical in aerospace, defence, medical and industrial applications due to their strength and resistance to corrosion. One of the biggest impediments facing alloy manufacturers and their customers is the cost of making them, but Amaero has technologies (particularly its proprietary Electrode Inert Gas Atomisation or EIGA) that have far lower production costs and a far higher yield.

Amaero’s EIGA Premium technology makes it a leader in the market for premium powder products. The company has also developed expertise in hot isostatic pressing for parts manufacture that fills a gap in the lack of forging and casting capacity in the US.

Amaero is already an important player

Amaero’s Tennessee plant helps fulfil America’s need for onshore defence manufacturing capability. This represents a once in a generation investment opportunity for companies like Amaero. The company was able to complete the facility during 2025 with the help of a US$22.8m loan from the Export-Import Bank of the United States. The first major supply agreement came in April 2025. Revenues are ramping up with A$4.7m in the first quarter of FY26 alone, and A$18-20m is expected for the entire FY26 financial year.

Valuation of $0.62-$1.30 per share

We value Amaero at $0.62 in a base case and $1.30 in an optimistic case based on the kind of earnings the company could reasonably expect to scale to late in the current decade, and an EV/EBITA multiple based on North American comparables. Please see page 27 for more details on our valuation and page 29 for the key risks.