RS Group (AO) | Buy | CC: better H2 exit rate with stronger platform and gradual recovery

Research evidence excerpt

RS Group (AO) | Buy | CC: better H2 exit rate with stronger platform and gradual recovery

News comment

Release date: 20 May 2026

Emanuele Sartori

Equity Research Analyst

Buy + 44 207 621 5267RS Group esartori@keplercheuvreux.com

United Kingdom | Capital goods MCap: GBP2.8bn

Target Price: 760p Bloomberg: RS1 LN Reuters: RS1R.L

Current Price: 600.50p Free float 100%

Up/downside: 26.6% Avg. daily volume (GBPm) 1,236.6

YTD abs performance -3.8% Market data: 19 May 2026

52-week high/low (GBP) 732.50/541.50

CC: better H2 exit rate with stronger platform and gradual recovery

Key points:

A good-quality call validating a strong share price reaction, but without introducing a major earnings upgrade. Management reinforced

that the business exited the year better, with improving Q3/Q4 momentum, firmer PMIs and better operational execution, which likely

helped support the stock’s strong move. That said, the tone remained measured rather than euphoric, with management still stopping

short of calling a full recovery.

The most important positive from the call was that the self-help story looks increasingly credible. Management gave more evidence that

the investments in pricing, customer targeting, digital tools, RS PRO and supply chain are starting to deliver, while also showing

continued share gains in most categories. In a market that has long questioned execution, that greater confidence in the quality of the

platform likely mattered as much as the numbers themselves.

The key caveat is that the recovery is still gradual and some tailwinds are not fully repeatable. Volumes remain soft, Mexico is still a near-

term drag, and part of the H2 gross margin benefit in the Americas was described as temporary, while management was clear that