SMC Group-recent IPO

160p may well prove conservative HH.

If
SMC did 3.2p eps in H1 and just meet forecasts of 7.2p for the year then that's 4p in H2.

Next year they have H1 which wil have both the acquisitions in on it from the float anbd the recent acquisition of DTR. I can't see any way that they won't do at least 5.5p in H1 next year and 6.5p in H2 makin 12p eps. That would still be a forward PE of 9 while others buy to build are trading on 15-17.

1f you work on 12p eps this year then 16p+ looks easy for 2007. Put that on a forward PE of 12.5 which is easily reasonable for this sort of growth and we have £2 in a year imo.

I'd say these figures may prove too conservative. I'd also say that when you consider the earnings visibility SMC deserve to trade on a lot higher PE too.

This will re-rate through 2006 as the market wakes to the potential imo - I think £2 will prove to have been a very conservative estimate.

Happy New Year! :-)

CR