Growth and margins improved in FY2026, while weak cash conversion tempers the thesis. Independent base fair value 847p versus the 634p close.
*Forward P/S ratios approximate market cap divided by a current annual sales estimate: BDC 2026 consensus USD 3.4B and VLX FY27 consensus USD 1.387B; MEI and TEL use vendor forward ratios. Observed EBITDA peer median 11.74x. The multiple is derived before the fair value: VLX FY27E revenue growth 11.6% versus approximate peer median 15.0% (MEI FY27 ~3%, BDC FY26 ~25%, TEL FY26 ~15%) gives -1.7% using the 5%-per-10pp grid; FY26 EBITDA margin 13.18% versus FY25 12.40%, a 0.78pp rise, gives +3.9%. Thus 11.74 × 1.022 = 12.00x. Peer growth comparisons span different fiscal periods and acquisition effects, a material uncertainty. FY27E sales USD 1386.7M = FY26 USD 1,242.6M × 1.116, from analyst consensus growth; FY27E EBITDA USD 182.8M = FY26 USD 163.8M × 1.116 with flat 13.18% margin, an analyst estimate. Segment rows simply allocate group EBITDA pro rata to FY26 revenue because separate segment margins are not disclosed. Enterprise value USD 2193.3M minus March net debt USD 121.5M equals equity USD 2071.8M; divide by 184.27M shares and 1.3271 USD/GBP to get 847.2p. Implied EV/EBITDA equals 12.00x. March net debt predates buybacks. Separate FCF cross-check is adverse: FY26 reported FCF USD 38.8M, only 23.7% of EBITDA; 20x FCF equals USD 776M equity, below both current market cap and this model. The two approaches are not blended.
| Component | Assumption | $/share |
|---|---|---|
| EV & Electrification | FY27E sales USD 202.9M × group EBITDA margin 13.18% × 12.00x; allocation proxy | +131.2 |
| Off-Highway | FY27E sales USD 311.7M × group EBITDA margin 13.18% × 12.00x; allocation proxy | +201.6 |
| Consumer Electricals | FY27E sales USD 270.5M × group EBITDA margin 13.18% × 12.00x; allocation proxy | +175.0 |
| Medical | FY27E sales USD 174.3M × group EBITDA margin 13.18% × 12.00x; allocation proxy | +112.7 |
| Complex Industrial Technology | FY27E sales USD 427.3M × group EBITDA margin 13.18% × 12.00x; allocation proxy | +276.4 |
| Net debt | Minus USD 121.5M as at Mar 2026 /184.27M shares /1.3271 USD per GBP | -49.7 |
| FV base case | Five operating rows plus net debt; sum before rounding | 847.2 |
| Item | FY2024 | FY2025 | FY2026 | FY2027E analyst |
|---|---|---|---|---|
| Revenue (USD M) | 912.8 | 1,086.5 | 1,242.6 | 1,386.7 |
| Underlying EBITDA (USD M) | N/D — not extracted | 134.7 | 163.8 | 182.8 |
| Underlying operating profit (USD M) | 89.7 | 106.2 | 127.3 | N/D — no issuer guide |
| Reported free cash flow (USD M) | 49.8 | 36.8 | 38.8 | N/D — no issuer guide |
| Net debt ex-operating leases (USD M) | 154.0 | 127.4 | 121.5 | N/D — updated balance pending |
| Half-year item | H1 FY2025 (Sep 2024) | H1 FY2026 (Sep 2025) |
|---|---|---|
| Revenue (USD M) | 518.1 (derived from 583.9/1.127) | 583.9 |
| Underlying EBITDA (USD M) | 61.3 | 73.6 |
| Underlying FCF (USD M) | -11.5 | 4.8 |
FY26 gross margin 23.2% versus 21.4%; underlying operating margin 10.2% versus 9.8%.
Working capital used USD 55.2M versus USD 18.1M in FY25, driven by Data Centre inventory and receivables.
Business model — engineered power and connectivity
EV & Electrification USD 181.8M FY26 +4.8% organic FY27 segment sales and margins are not separately guided. Off-Highway USD 279.3M FY26 +20.0% organic FY27 segment sales and margins are not separately guided. Consumer Electricals USD 242.4M FY26 -7.8% organic FY27 segment sales and margins are not separately guided. Medical USD 156.2M FY26 -10.5% organic FY27 segment sales and margins are not separately guided. Complex Industrial Technology USD 382.9M FY26 +56.3% organic FY27 segment sales and margins are not separately guided.
Complex Industrial Technology includes Data Centre products, 63% of its FY26 revenue, and industrial/defence work. Segment margin disclosure is insufficient for standalone valuations, so the fair-value bridge allocates group profit pro rata.
Legal, regulatory and risk analysis
Reviewed 2026 issuer announcements and targeted searches for litigation, short-seller reports, investigations, new share issuance and director dealings. No material current case was verified in that search; absence from search is not proof of absence. The July Main Market prospectus was a listing document, not evidence of an equity raise.
SWOT analysis
- +14.2% organic sales growth
- +180bp gross-margin gain
- +0.8x covenant leverage
- +Five end markets and 23 sites
- −FCF only 23.7% of EBITDA
- −Working-capital drag
- −Consumer and Medical declines
- −Concentrated CEO influence
- →Hyperscale data cabling
- →Defence programmes
- →Medical destocking recovery
- →Potential accretive buyback
- !Hyperscale programme pause
- !Chinese appliance competition
- !GBP/USD shifts
- !Peer multiple compression
Summary by assessment area
- FY26 sales +14.4%, underlying operating profit +19.9%.
- Data Centre and Off-Highway offset weaker units.
- USD 38.8M FCF versus USD 163.8M EBITDA.
- FY27 half-year working capital is the next test.
- 847p peer base versus 634p price.
- Analyst targets and FCF cross-check are lower.
Sources: FY2026 issuer RNS ; Volex investor site ; H1 report ; FY2024 report ; price ; price check ; market cap ; forecast ; Belden peer ; Methode peer ; TE peer ; UK shorts ; dated targets ; FX . Price used: 634p close 2026-10-15; 184.27M shares; implied GBP 1.168B cap; 52-week 350p–705p; GBP/USD 1.3271. This document is for informational purposes only and does not constitute financial or investment advice.