Shares of Czechoslovak Group (CSG) have plummeted to their lowest level since the defense firm’s initial public offering (IPO) in January, as investors react to a series of challenging developments. The stock, which briefly traded as high as 816 Czech koruna shortly after the IPO, has faced mounting pressure in recent weeks.
The latest blow to CSG’s stock price stems from a demand by Petr Kratochvíl, a long-time manager and co-founder of the group, for the repurchase of his stake. According to reports from E15 and Seznam Zprávy, Kratochvíl is seeking nearly 35 billion Czech koruna for his shares – a detail that was not disclosed in the company’s IPO prospectus.
CSG Disputes Valuation
CSG, led by Michal Strnad, disputes the valuation, suggesting the stake may be worth up to ten times less. Despite the disagreement, the company’s shares fell by over four percent during midday trading on Thursday, March 14, 2026, wiping out approximately 29 billion Czech koruna of CSG’s market value – a figure that nearly matches Kratochvíl’s asking price.
“We see not yet certain at what price CSG will agree with the other party, and what the actual value of this stake is. At first glance, this amount seems exaggerated,” commented Petr Bártek, an analyst at Česká spořitelna. The news arrives shortly after investigative journalists from Follow the Money revealed that CSG’s Spanish subsidiary was placed on a blacklist by the NATO Support and Procurement Agency (NSPA) last year. This information was also absent from the IPO prospectus. “The negative news regarding CSG in recent days has simply triggered a market reaction,” noted Radim Dohnal, an analyst at Capitalinked.
The situation is further complicated by investor sentiment within the defense industry, with a growing distinction being made between companies poised to benefit directly from the conflict in the Middle East and those with a more regional focus. “Companies like BAE Systems, which generates nearly half of its revenue from the US, have strengthened on the stock market. Conversely, shares of companies primarily focused on Europe, typically German defense companies without the ability to significantly profit from the ongoing conflict, have stagnated or fallen,” explained Pavel Ryska, an analyst at J&T Banka.
Ryska also pointed out that investors often group German and Czech defense companies together, potentially impacting CSG’s performance. “The decline in CSG’s shares may also have been contributed to by the slightly weaker financial results recently published by the German company Rheinmetall,” he added.
17 Percent Drop Since IPO Peak
Since reaching a peak of 816 Czech koruna in January following the IPO, the stock price has fallen by 17 percent. Whereas the IPO price was 608 Czech koruna, the current share price remains nearly 11 percent above that level. The IPO was primarily participated in by large institutional investors, leaving individual investors to purchase shares on the open market at a higher price. Despite the recent challenges, analysts believe the fundamentals remain strong for the defense industry as a whole.
“The ongoing conflict only underscores the significant increase in geopolitical instability and risks, which will require greater preparedness and capacity from European armies. This could indicate a growing trend in the performance of defense companies,” Bártek concluded. CSG listed on the Amsterdam and Prague stock exchanges in late January. The developments highlight the complexities of navigating public markets, particularly for companies in sensitive sectors like defense.
