Why fund managers like IPD Group's quiet data centre exposure
An electrical equipment distributor is growing its data centre revenue at 25% a year, and fund managers see more bolt-on acquisitions ahead.
29 Jun 2026 · 5 min read
In short
IPD Group has guided FY26 EBIT to $46.3-47.1 million, implying 19% growth at the midpoint, according to Wilson Asset Management.
Data centre work now makes up around 17-20% of IPD Group's revenue and is growing 25-30% a year, per Centennial Asset Management.
The company acquired electrical cable supplier Platinum Cables at 5.2 times EBIT, estimated to be 11.5% earnings per share accretive.
Electrical products distributor IPD Group has become a preferred way for several small-cap managers to access the data centre buildout theme without owning a pure-play technology stock. Wilson Asset Management's June 2026 Newsletter detailed FY26 EBIT guidance of $46.3 million to $47.1 million, implying 19% growth at the midpoint, supported partly by the Platinum Cables acquisition and data centre demand where revenue has grown 25%.
A distributor riding the data centre buildout
Centennial Asset Management's April 2026 Presentation captured the shift in the business mix, noting data centre work now makes up 17% of revenue and is growing at 25-30% a year, despite the company historically having little exposure to the category. QVG Capital has flagged the same dynamic in successive Monthly Reports, noting in April 2026 that IPD Group is benefiting from cost inflation being passed through to customers alongside accelerating capital deployment into data centres, a market it shares with peer SXE.
The investment team expect IPD Group will continue to grow market share organically and that it should grow at double the rate of its underlying sector exposure.
— Wilson Asset Management, Newsletter, June 2026
Asymmetric Asset Management, which named IPD Group its largest position in December 2025, pointed to the Platinum Cables acquisition as a template for how the company compounds: bought at 5.2 times EBIT against a market average of 16.9 times, and estimated to be 11.5% earnings per share accretive, prompting upgrades from all five covering brokers. Spheria Asset Management's April 2026 Article described it more simply as a strong cash flow business that is attractively valued and well managed.
What managers are watching next
Wilson Asset Management's May 2026 Article set out the bull case in full: a founder-led company with a strong, close to net cash balance sheet, that is likely to keep acquiring in a creative fashion as data centre and energy transition demand continues to build. Centennial Asset Management, by contrast, trimmed exposure to interest-rate-sensitive names including IPD Group in March 2026, prioritising businesses with lower-risk capital expenditure exposed earnings growth, a reminder that the stock's re-rating still carries some cyclicality risk tied to the broader construction market.
Questions
How exposed is IPD Group to data centres?
According to Centennial Asset Management, data centre work makes up around 17 to 20% of IPD Group's revenue and is growing at 25 to 30% a year, up from a business that historically had little data centre exposure.
What has IPD Group's guidance been for FY26?
IPD Group guided FY26 EBIT to a range of $46.3 million to $47.1 million, implying around 19% growth at the midpoint, according to Wilson Asset Management's June 2026 Newsletter.
Why did IPD Group acquire Platinum Cables?
Asymmetric Asset Management notes IPD Group acquired Platinum Cables at 5.2 times EBIT, well below the market average, in a deal estimated to be 11.5% earnings per share accretive and expanding its exposure to the resources sector.
6 managers, 14 comments, with each manager's latest recorded position.
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