Make a space for Marshall

Since chief executive Daksh Gupta took the wheel in 2008, acquisitions have played a key part in the strategy to diversify Marshall by both geography and the car brands it sells. Indeed, over that period it has acquired or opened 18 new dealerships at the same time as closing 25 sub-scale or loss-making operations. This has expanded the group from being East Anglian-centric to cover 16 counties.

This strategy took another step forward late last year with the £24m acquisition of SG Smith. The deal represented a major expansion of the group's relationship with Audi UK, a strengthening of its Skoda representation and an extension of its partnership with Mercedes Benz in commercial vehicles. It also extended its geographic footprint in new markets across Kent, Surrey and London. The acquisition prompted broker Investec to ramp up EPS forecasts for 2016 by 14 per cent. There should be plenty more scope for earnings-enhancing deals, too, given the fragmented nature of the motor dealership market, Marshall's track record and a strong balance sheet backed by a £75m revolving credit facility.

But Marshall's growth has not all been bought. For a start, the company has a strong track record behind it. Between 2012 and 2014 it achieved a compound annual sales growth rate of 17 per cent and 68 per cent for pre-tax profit. Return on capital employed (ROCE) also improved from just 12 per cent in 2012 to 24 per cent in 2014.

A "significant increase" is expected from both the retail and leasing divisions in the recently completed financial year despite increased costs associated with the IPO. The leasing division, which accounted for 16 per cent of first half profit, is benefiting from the robust used-car market through de-fleeting - selling cars that have served their time as lease vehicles - which has resulted in "material" sales growth.