Back British winners: three UK manufacturers with growth potential for investors

Investors seeking to profit from backing Britain are turning to select British manufacturers that pair patriotic pride with potential financial upside. G&H, Halma and Nichols are cited as examples of firms that produce high-margin, skilled products in defence, safety technology and beverages, all anchored in Britain with international reach.

Britain's manufacturing base remains a pillar of the economy. Last year, UK-made goods totaled about £452 billion in sales, with notable growth in beer and aeroplane components. Yet data released last week showed the sector facing headwinds as orders soften and costs rise in some subsectors. The Made in Britain label is seen by many investors as a tie between domestic production and earnings visibility, offering a potential premium in overseas markets while helping secure supply chains.

Gooch & Housego, now known as G and H, makes imaging systems for submarines and tanks, plus components for tattoo removal equipment, portable ultrasound devices and subsea telecom cables. In the UK it operates in Ashford, Ilminster, Torquay, St Asaph and Plymouth, with manufacturing bases in the United States after a recent acquisition. Its niche puts it in defence, communications and life sciences, growth areas in which brokers say UK military spending could lift demand. In the June half, results were in line with expectations, supported by a robust order book and improving margins, although the year brought two profit warnings in 2024. The stock trades on AIM under ticker GHH and yields roughly 2.4 percent in dividends. Shares have fallen from around £15 in 2021 to about £5.74, underscoring the risk and opportunity in a high-precision, capital-intensive segment. Analysts note that US trade tariffs are a potential hurdle, but defence and aerospace strength could help G&H pass higher costs to customers.

Halma, a FTSE 100 conglomerate, operates by acquiring niche technology firms and letting them run independently, with a portfolio that spans safety and hazard detection. Many Halma companies make products in Britain, from Palintest in Gateshead to Apollo Fire Detectors in Havant, while the group maintains a substantial US presence. As regulators tighten for factories or residences, hazard detection products tend to be non-discretionary and support steady demand. Halma faces no easy path; US tariffs and regulatory shifts remain a watch point, and the stock has priced in a long track record that some investors may view as expensive. The shares are trading around £33.56, up about 25 percent this year, though they slipped 0.7 percent in the latest session. For long-term holders, weakness during market dips has been cited as a potential entry point, given Halma's diversified portfolio and non-discretionary demand for safety solutions.

Nichols AIM-listed Vimto maker Nichols also focuses on consumer brands with export potential. Based in Ross-on-Wye, the company now also produces Levi Roots branded drinks and post-mix syrups for pubs and caterers. Vimto began in 1908 as Vimtonic, an energy drink, and the secret blend remains in the hands of a few family members who retain a large stake on the board. About 75 percent of sales come from the UK, with ambitions to grow in the Middle East and Africa. Nichols ended 2024 with roughly £50 million in net cash and typically pays out around half of profits as a dividend. The shares have fallen about 7 percent this year, which some analysts view as an attractive entry point for a well-controlled, cash-generative consumer brand with global growth potential. Nichols trades on AIM under NICL.

AJ Bell and other brokers highlight the appealing mix of resilient demand and domestic manufacturing exposure in these names. Russ Mould of AJ Bell notes that Halma's products address non-discretionary safety needs, a factor that can help weather cyclical downturns. Nicholas Hyett of the Wealth Club emphasizes Vimto's brand strength and international growth opportunities, particularly outside the UK. In each case, investors must weigh valuation against execution risk, including currency headwinds, supply chain dynamics and regulatory developments that can affect order books and margins.

The broader context matters as well. The UK has shown a robust ability to produce sophisticated goods—from niche engineering to pharmaceuticals—and a substantial portion of output remains reliant on skilled labor and advanced manufacturing capabilities. But the sector is not immune to macro shifts, including tariff climates and energy costs, which can affect capital-intensive suppliers and industrials. The trio of G&H, Halma and Nichols underscores a strategy some investors are pursuing: back homegrown manufacturing that blends domestic resilience with global reach, aiming to capture both earnings visibility and a sense of national economic significance. It is a nuanced approach that requires careful due diligence, given the mix of niche exposure, regulatory risk and the ebb and flow of military and consumer demand.

Taken together, these names illustrate how investors can blend exposure to domestic manufacturing with niche, defensible markets. The broader UK manufacturing picture faces headwinds from global demand and policy shifts, but for longer term investors these firms show how the Made in Britain story can align with earnings visibility, dividend income and diversification in a portfolio.