IMI (1K) | Buy (Hold) | Back into the A-game

Research evidence excerpt

IMI (1K) | Buy (Hold) | Back into the A-game

ack, with 6% organic

revenue growth, only a modest 2% decline in orders against a tough comparator, and underlying

aftermarket trends still around mid-single digits once nuclear and Middle East effects are

normalised. Still, outlining particularly strong momentum in conventional power, where new

construction orders doubled in Q1, alongside good starts in LNG and a healthy nuclear pipeline.

Elsewhere, Industrial Automation was better on easier comps and improving U.S. demand,

Climate Control continued to perform well with datacentre liquid-cooling growth still very strong,

and Life Science & Fluid Control showed further signs of stabilisation.

On the main risk factor, seen across the industry, the Middle East disruption was not significant in

Q1, though around GBP30m of FY shipments could be at risk if April conditions persist.

Importantly, this appears more of a timing issue than a structural demand issue, with margin

impact immaterial and scope for future rebuild / energy-security-related demand.

Overall, the update reinforced the view that IMI remains on course for another solid, H2-weighted

year, with better resilience than feared and a supportive sector backdrop in power, LNG, nuclear

and aftermarket.

Estimates revision

On the back of that, we revised our estimates, incorporating a more positive outlook for Industrial

Automation and transport, as well as a stronger H2 for Process Automation, where we, hopefully,

see a successful termination of the current conflict and the completion of the orders mentioned.

Overall, we increase our Revenue across the three years by c.1%, with a similar drop through for

Adj. operating profit. Thus, we increase by c.1% our EPS for 2026, which is now slightly above the