Panmure Liberum has reaffirmed its buy rating on discoverIE Group PLC (LSE:DSCV), the electronics design and manufacturing company, with a price target of 990p.
The broker highlighted the company’s recent acquisition of Germany-based Burster Group as a key driver of long-term growth and profitability.
DiscoverIE’s shares were trading at around 690p Wednesday, suggesting potential upside of over 40%.
Burster Group specialises in precision sensors and measurement equipment, including load cells, torque sensors, and pressure sensors.
These products are integral to industries such as automotive, aerospace, and industrial automation, where accurate data measurement is critical.
The acquisition, valued at £25.9 million upfront with an additional potential earn-out of £10.5 million contingent on performance, is being funded through existing debt facilities.
DiscoverIE is known for its “cluster model,” which integrates acquired companies while preserving their individual brands.
Burster will join the Variohm group, discoverIE’s existing cluster of sensor technology businesses. This approach enables cross-selling opportunities, leveraging Burster’s global footprint, which spans sales in over 60 countries.
The German company achieved revenues of £15 million in 2025 with operating margins exceeding 15% — figures in line with discoverIE’s medium-term goals.
It will contribute a 4% increase to underlying earnings in the current year, Panmure Liberum said, noting that discoverIE continues to pursue inorganic growth opportunities, with over £40 million in financial headroom remaining for further acquisitions.
This gels with the company’s strategy to grow through acquisitions that enhance its portfolio of niche, high-margin products.
DiscoverIE has a strong track record of improving the margins of acquired businesses, and management is optimistic about Burster’s potential to scale further.