KNL's Strategic Position in the Global Military HF Radio Market: A Geopolitical-Driven Growth Story

In an era where geopolitical tensions are reshaping defense priorities, the demand for resilient, secure communication systems has never been more urgent. KNL, a subsidiary of Norway's Telenor, has emerged as a quiet but formidable player in the high-frequency (HF) radio market, leveraging its cutting-edge technology and strategic partnerships to position itself at the intersection of Nordic defense cooperation and global military modernization. For investors, this represents a compelling case study in how geopolitical tailwinds can transform a niche technology into a high-margin growth opportunity.

The Case for KNL: Satellite-Independent Resilience

The Ukraine war has underscored the vulnerabilities of traditional communication infrastructure. Satellite systems, once considered the backbone of military connectivity, are now prime targets for jamming and cyberattacks. KNL's Cognitive Networked HF (CNHF) Manpack radios offer a solution: portable, encrypted, and capable of operating in environments where SATCOM is compromised. These systems can automatically switch between 4,000+ channels, establish secure links in seconds, and transmit data at speeds up to 300 kbps—far outpacing legacy HF systems.

This technological edge has already translated into action. In 2025, KNL secured a €15 million contract with Finland and Sweden under the NORDEFCO framework, marking the first joint procurement of its CNHF systems. The Nordic nations, increasingly aligned with NATO's interoperability goals, are betting on KNL's ability to provide a secure, low-probability-of-intercept (LPI/LPD) communication backbone for joint operations. With the contract set to be fulfilled by year-end, KNL is now scaling production and eyeing expansion into other NATO-aligned markets.

Telenor's Undervalued Defense Play

Telenor's acquisition of KNL five years ago was initially seen as a minor diversification move. But as defense budgets surge and the need for secure communication infrastructure grows, KNL has become a crown jewel. The company's focus on military-grade HF systems—a market projected to grow at 7% annually through 2033—positions Telenor to capture a disproportionate share of a $2 billion niche. Yet, Telenor's broader market cap remains anchored to its telecom operations, which, while stable, are overshadowed by the explosive potential of KNL's defense segment.

The numbers tell a story of underappreciated value. The global tactical HF radio market is expected to reach $7.3 billion by 2030, while the broader defense infrastructure market—encompassing secure communications, cybersecurity, and resilient networks—is valued at $100 billion. KNL's satellite-independent systems, already in demand across NATO circles, are uniquely positioned to benefit from this convergence. As CEO Toni Lindén notes, “The CNHF is not just a radio—it's a foundational element of modern warfare.”

Geopolitical Tailwinds and NATO Alignment

The Nordic defense landscape is shifting rapidly. NORDEFCO's joint procurement model, which prioritizes interoperability and shared infrastructure, has created a fertile ground for KNL's growth. Finland and Sweden's recent NATO accession has further amplified the need for standardized communication systems, and KNL's CNHF technology is now a key component of their defense modernization plans.

While KNL has not yet received formal NATO certification, its alignment with alliance priorities is evident. The company's systems are already being tested by NATO partners, and its participation in multinational exercises is likely to accelerate certification efforts. This is critical: NATO certification would open doors to a broader client base, including the U.S. Department of Defense and other European militaries.

Investment Implications: A High-Margin, Long-Term Bet

For investors, the case for Telenor is twofold. First, KNL's technology offers a defensible moat in a market where innovation and interoperability are paramount. Second, the Nordic defense boom—driven by Russia's aggression and China's assertiveness—ensures sustained demand for secure, resilient communication systems.

Telenor's stock, currently trading at a multiple that reflects its telecom operations but not its defense ambitions, appears undervalued. With KNL's contracts set to ramp up in 2026 and NATO certification on the horizon, the company is poised to unlock significant upside. Analysts project that the defense segment could contribute 20% of Telenor's revenue by 2030, up from less than 5% today.

Conclusion: A Quiet Revolution in Military Communications

KNL's rise is emblematic of a broader trend: the renaissance of HF radio in an age of digital warfare. As governments prioritize systems that can withstand cyberattacks and jamming, KNL's satellite-independent, encrypted solutions are becoming indispensable. For Telenor, this represents a golden opportunity to transform from a telecom provider into a defense technology leader.

In a world where communication is the lifeline of military operations, KNL's strategic position is not just about hardware—it's about securing the future of warfare. For investors willing to look beyond the noise, Telenor's stake in KNL offers a rare combination of geopolitical tailwinds, technological innovation, and long-term growth potential.