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Bydgoszcz, Poland. Population 350,000.
A river winding between renovated Soviet-era apartment blocks turned into lofts for young entrepreneurs.
Trendy cafés, a medieval old town, students crossing the market square with AirPods in. A normal, quiet, almost boring Polish city.
And then, a few kilometers from the city center, behind barbed wire fences and military-grade surveillance cameras, there’s an industrial complex you won’t find on any tourist map.
Nitro-Chem.
I didn’t know that name four months ago. Today, it’s the first thing I type into my Bloomberg terminal every morning.
Because this factory — this single building in this single Polish city — produces all of continental Europe’s military-grade TNT.
Let that sink in for a second.
All of Europe. All of NATO’s European side. Thirty-two countries. 450 million people. The world’s second-largest economy. And to manufacture the base component of every artillery shell, every grenade, every aerial bomb... they depend on one factory. In a city you probably just learned exists.
The United States shut down its last TNT plant in the 1980s.
The UK closed its last one in 2008.
Ukraine had one — Russia seized it in 2022.
That leaves Nitro-Chem. Full stop.
The number that kept me up at night
I stumbled onto this story in February, during a call with a Warsaw-based analyst who specializes in military supply chains. We were talking production rates, arms contracts, Poland’s industrial ramp-up. Standard stuff.
And then he dropped a number, casually, between sips of coffee.
“Do you know how many tons of TNT Nitro-Chem produces per year?”
I said I didn’t.
“Roughly 6,000 to 10,000 tons. Do you know how much Russia consumes for its ammunition production?”
“No idea.”
“50,000 tons.”
Silence.
I hung up, opened a spreadsheet, and started running the math that nobody in finance runs — because nobody in finance thinks about TNT.
Every 155mm artillery shell — NATO’s standard caliber, the one that makes the difference between holding a frontline and losing it — requires about 10 kilograms of TNT. Do the math: with 10,000 tons, you produce one million shells. Maximum.
NATO’s target for 2026? 267,000 shells per month. That’s 3.2 million per year. That’s 32,000 tons of TNT. Just for artillery shells.
And we haven’t even talked about aerial bombs. Grenades. Demolition charges. Mines.
Russia, meanwhile, produces in three months what NATO produces in an entire year.
Four to one. That’s the ratio. NATO Secretary General Mark Rutte has confirmed it publicly. Some estimates put it at six to one.
And the bottleneck of this entire equation? It’s not money — the budgets have been voted. It’s not political will — that’s there. It’s a factory. One single factory in Bydgoszcz.
When a fintech founder decides to save NATO
Here’s the part of the story that tipped me from curious analyst to committed investor.
In 2024, a Swede named Joakim Sjöblom sold his fintech startup Minna Technologies to Mastercard. Comfortable exit. The kind that lets you take a gap year, buy a boat, write a book.
Instead, Sjöblom did something nobody in tech would have predicted: he decided to build a TNT factory.
He spent months meeting politicians, military officials, arms industry executives. He kept asking the same question: why does Russia produce so much more ammunition than we do? And the answer always came back to the same point: raw materials. Explosives. TNT.
His startup is called SWEBAL — Sweden Ballistics. The goal: build Europe’s second TNT factory, deep in the Swedish forest, near the small town of Nora. Target capacity: 4,500 tons per year by 2027. Enough to increase European production by 75%.
In an interview, Sjöblom said something that stopped me cold: “My daughter turned one month old today. That’s one of the reasons I decided to do this — to make sure she doesn’t grow up in a world at war.”
A fintech founder who sells to Mastercard and uses the money to manufacture TNT for NATO. If you’re looking for a signal that the world has changed, I don’t know a clearer one.
But for us as investors, what matters is what this story reveals about market structure. Because TNT isn’t an isolated case. It’s a symptom.
The problem runs through the entire chain
Propellant powder? Rheinmetall, Europe’s largest producer, is targeting a 50% increase in output by 2028 — and its CEO, Armin Papperger, says even that won’t be enough. They’ll probably need to double production to 20,000 tons per year.
Nitric acid, an essential component of explosives? Largely imported from... China.
Cotton, the raw material for propellant powder? Global supply chains, vulnerable to disruption.
Patriot air defense systems? Ten-year delivery backlogs.
The problem isn’t one weak link. It’s the entire chain that’s undersized for the world we live in now.
And that’s where this becomes a once-in-a-generation investment opportunity.
The man Russia tried to assassinate
Before I show you the numbers, I want to tell you one more story. Because it illustrates better than any chart just how real the stakes are.
Armin Papperger. CEO of Rheinmetall. Head of Europe’s largest weapons manufacturer.
In July 2024, US intelligence services intercepted a Russian plot to assassinate him. NATO described the plan as “the most mature” in a series of assassination attempts targeting European defense industry leaders.
The Americans alerted Berlin. German security services foiled the plot. Papperger now lives with a permanent police protection detail.
When I read that, I had a moment of absolute clarity.
This isn’t a sector like any other. This isn’t the next trendy app or another SaaS company doing 2x on its ARR. These are companies so strategically critical that a foreign state is willing to assassinate their leaders to slow down production.
And Rheinmetall’s stock through all of this? It went from €97 on the day of the Ukraine invasion to over €1,600 today. +1,500% in less than four years. Rheinmetall’s market cap has now surpassed Volkswagen’s — Germany’s most iconic automaker.
Papperger even publicly stated he wants to acquire a Volkswagen plant in Osnabrück — a factory that used to assemble T-Roc convertibles — and convert it into production of Lynx armored vehicles.
Convertibles becoming tanks. Car factories becoming weapons plants. Germany rewriting its constitution to take on massive defense debt.
We’re witnessing an industrial transformation Europe hasn’t seen since 1945.
And the market? The market still treats this cycle like a “Ukraine trade.” As if peace in Ukraine would make it all stop.
That’s the biggest mispricing I’ve seen in fifteen years.
Poland: Europe’s largest army, and nobody’s talking about it
On January 1st, 2026, Polish Prime Minister Donald Tusk declared that 2026 would be “the year of Polish acceleration” and that Poland would build “the strongest army in Europe.”
This isn’t rhetoric.
Poland currently spends 4.7% of GDP on defense — more than double France, more than Germany, more than the UK. The official target is 5% by 2026. Five percent of GDP for a country of 38 million people. In peacetime.
Poland’s armed forces have grown from 130,000 troops before 2022 to 215,000 today. Target for 2030: 300,000. Wartime mobilization capacity: over 500,000. Poland is already NATO’s third-largest military by personnel, behind only the United States and Turkey.
And the shopping list is staggering:
1,300 tanks, including 800+ South Korean K2 Black Panthers and 250 American M1A2 Abrams. 500 HIMARS launchers — across 28 squadrons. 32 F-35A stealth fighters. 48 South Korean FA-50 light combat aircraft. 96 Apache attack helicopters. 3 Swedish A26-class submarines, in a $2.6 billion deal with Saab. A dedicated drone command. A civilian training program — “wGotowości” (Readiness) — teaching first aid, survival skills, and cybersecurity on weekends.
The Polish parliament even voted to withdraw from the Ottawa Convention on anti-personnel mines. Over 1,000 bomb shelters have been inspected and certified for civilian protection.
Poland’s defense budget from 2026 to 2030? $301.6 billion. Compared to $138.1 billion for the 2021-2025 period. That’s a 118% increase in five years.
And that’s Poland alone. One single country.
When I add Germany (€500 billion in additional borrowing capacity for defense), France, the UK, the Baltic states, Scandinavia, and the EU’s €150 billion SAFE loan facility...
You get a European defense spending pipeline that exceeds $2.6 trillion over the next decade.
What the market still doesn’t understand
The current consensus among investors — retail and institutional alike — can be summed up in one sentence: “If peace comes to Ukraine, defense stocks crash.”
It’s wrong. Dangerously wrong.
Even if Ukraine and Russia signed a ceasefire tomorrow morning at 9 AM, European defense budgets would continue accelerating through 2030 and beyond.
Why? Because the real story was never Ukraine. The real story is thirty years of catastrophic underinvestment that now has to be corrected.
If every EU member state had simply met NATO’s 2% of GDP guideline from 2006 to 2020 — not exceeded it, not outperformed, just met the baseline — that would have generated €1.1 trillion in additional defense spending.
€1.1 trillion. More than the entire annual US defense budget.
That money was never spent. And now Europe faces the largest capability gap in NATO history. Across every front: air defense, artillery, ammunition, drones, cyber, military mobility, AI-enabled warfare.
The institutional mechanisms to fund this catch-up are already in place: Germany’s €100 billion special fund, the constitutional reform exempting defense spending above 1% of GDP from the debt brake, the EU’s Readiness 2030 plan mobilizing €800 billion, the €150 billion SAFE loan facility...
These aren’t campaign promises. These are laws passed, budgets allocated, contracts signed.
And in the stock market? The STOXX Europe Aerospace & Defense index gained over 65% in 2025. Order books across Europe’s eight largest defense companies grew 15% in 2024. Their combined free cash flows hit an all-time record of over €8 billion.
Rheinmetall is targeting €50 billion in revenue by 2030 — that’s 5x its 2024 level — with operating margins of 20%.
And here’s the most interesting part: despite the spectacular rally, analysts at Rothschild Redburn estimate that European defense revenue growth will exceed 10.5% per year for the next decade. The massive increase in order backlogs hasn’t yet been reflected in financial results.
The re-rating isn’t over. It’s barely getting started.
Why I built this playbook
I’ve spent the last three months doing something I’ve never done with this level of intensity: building a complete investment playbook on a single sector.
I read Polish procurement reports. German budget amendments. South Korean export filings. Earnings call transcripts from twenty different companies. I spoke with analysts in Warsaw, Seoul, Berlin, and Stockholm. I modeled EBITDA margins for subsectors that most investors don’t even know exist.
And I built something I believe is the most comprehensive guide available today for investing in the European defense supercycle.
Not an opinion piece. Not a listicle of five tickers with a paragraph each. A real playbook.
What’s behind the paywall
For premium subscribers, here’s exactly what you’ll find:
🎯 My full defense portfolio — Every position revealed
The 14 companies I’m currently invested in, spread across three continents. For each position: the exact ticker, my entry price, my 24-month target, my position size as a percentage of portfolio, and the one-sentence thesis. You’ll see European names (some you probably haven’t heard of), Asian defense exporters, and yes — American positions that benefit from this cycle through channels nobody’s watching.
📊 My past performance on defense trades — with the receipts
I didn’t start paying attention to defense last month. I’m showing you my entries and exits since 2022, with timestamps and actual returns. No cherry-picking. The winners AND the losers. So you can judge for yourself whether this thesis holds up.
🔬 The 5 subsectors that will capture the most value (ranked by potential)
Not all defense companies are created equal. I break the supercycle into five segments — munitions & explosives, armored vehicles, air defense & missiles, drones & autonomous systems, software & C4ISR — and show you where margins are exploding, where order books are thickest, and where the market is mispricing most aggressively.
🇺🇸🇪🇺🇰🇷 The geographic breakdown — America, Europe, Asia
Why I’m overweight certain European mid-cap manufacturers that most American investors have never heard of. Why South Korea is the “Lockheed Martin of Asia” and how Hanwha Aerospace and Hyundai Rotem are positioned to triple revenue by 2028. And why some US prime contractors are actually shorts — not longs — in this cycle.
💡 The 7 game-changing innovations
The technologies transforming sector margins: AI-powered targeting, autonomous drone swarms, counter-drone defense, low-cost guided munitions, additive manufacturing of weapons systems, digital command networks, and predictive maintenance. For each innovation, the best-positioned public company and the exact catalyst that will trigger the re-rating.
📅 The contract calendar nobody’s tracking
The exact dates when Germany, Poland, France, and the UK will finalize their major 2026-2027 contracts — and how to position 60 to 90 days before each announcement. This calendar alone is worth the subscription.
⚠️ The 3 scenarios that would kill this thesis
I’m not a blind permabull. I show you the three specific scenarios that would invalidate my playbook — and the two inverse positions I’m holding as insurance. Including a short on a massively overvalued US prime contractor that’s losing European market share as we speak.
🧮 My sizing and risk management framework
How I allocate capital across 14 positions. Why I’m using 2x leverage on three of them (yes, really). My stop-loss levels. My hedging strategy. And the rule I follow to never exceed 25% sector exposure — even when conviction is maxed out.
The first company I profile in the playbook is a European critical-components manufacturer that supplies subsystems to five different weapons programs — including the Leopard 2, the K2 Black Panther, and the IRIS-T air defense system.
Its EBITDA margin expanded 340 basis points in 2025. Its order backlog covers 4.2 years of revenue. And it’s exposed to the three largest procurement pipelines in Europe: Germany, Poland, and Scandinavia.
Its current share price doesn’t yet reflect the contracts signed in Q4 2025.
It’s my largest position. And you’ll understand why within the first ten minutes of reading.