discoverIE Group

LN: DSCV

Market Cap£630m

Last Close 660p

discoverIE is a leading international designer and manufacturer of customised electronics to industry, supplying customer-specific electronic products and solutions to original equipment manufacturers.

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Investment summary

discoverIE has seen a strong bounce-back in trading after the worst of the COVID pandemic, with organic revenue growth of 18% y-o-y in FY22 and 14% versus FY20 (pre-COVID). The combination of organic growth and recent high-margin acquisitions generated underlying operating profit growth of 34% y-o-y with a margin approaching 11%. Organic order growth of 36% y-o-y has provided a strong order book entering FY23. With FY22 underlying EPS beating our forecasts, we upgrade FY23 and introduce FY24 estimates. We expect further M&A as discoverIE continues with its strategy to consolidate the fragmented electronics market.

Y/E Mar
Revenue (£m)
EBITDA (£m)
PBT (£m)
EPS (fd) (p)
P/E (x)
P/CF (x)
2021A 302.8 44.0 28.3 23.4 28.2 10.3
2022A 379.2 56.1 41.0 32.1 20.6 14.4
2023E 400.4 58.7 42.1 32.0 20.6 14.3
2024E 412.4 60.2 43.7 33.0 20.0 11.9
Industry outlook

discoverIE specialises in the design and manufacture of technically demanding, bespoke electronics for industrial applications with operations throughout Europe and increasingly outside Europe. The company is focused on four target markets comprising three-quarters of group sales – renewables, electrification of transportation, medical and industrial & connectivity – all of which are long-term structural growth markets.

Last updated on 01/07/2022
Content on discoverIE Group
discoverIE Group – Entering FY23 in a strong position
TMT | research Update | 19 April 2022
discoverIE
discoverIE Group – Continued order strength drives upgrades
TMT | research Update | 10 February 2022
discoverIE
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Share price graph
Balance sheet
Forecast net debt (£m) N/A
Forecast gearing ratio (%) N/A
Price performance
%
1m
3m
12m
Actual (10.1) (16.9) (30.2)
Relative* (5.0) (11.4) (28.0)
52-week high/low 1262.0p/608.0p
*% relative to local index
Key management
Nick Jefferies CEO
Simon Gibbins FD
Greg Davidson Company secretary
Lili Huang Head of Investor Relations
Malcolm Diamond Non-executive chairman