With Volution (FAN) posting its first set of full year results since its June IPO on 23 October, investors should be looking to assess the ventilation specialist's progress in integrating recent acquisitions such as the April InVENTer deal. We think the story stacks up nicely at 141p.

The group's 12 August update puts revenue in the 12-month period at £121 million which represents an 18.2% increase on the previous year. Organic growth accounts for 3.3% while the remainder (14.9%) is down to acquisitions like the group's August 2013 purchase of Pax in Sweden.


The share price has admittedly been trimmed 3.5% since IPO and much of this retrenchment can probably explained by wider concerns about the housing and construction markets in the second and third quarters.

Liberum's Charlie Campbell sees Volution as a highly profitable market leader in domestic ventilation with exposure to tightening environmental regulation and construction cycle upturn. Despite high margins (45% gross in 2013) and dominant market positions in the UK, Germany and Sweden, Volution still looks cheap compared to a peer group of stocks with similar characteristics such as regulatory drivers, leading positions and high returns, and Liberum maintains a 'buy' recommendation and a 170p target.

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Issue Date: 17 Oct 2014