Equity Development - Norcros - increased focus on driving UK/European potential

23 hours ago

Research on Norcros plc (NXR:LON) from Equity Development

In a strategic update, Norcros is proposing to exit trading in South Africa by exploring options to sell its operations there: this would increase focus on UK/European market development in its core bathroom products segments. The South African operations comprise a significant bathroom retailer (Tile Africa, 50%+ sales), trade-oriented House of Plumbing (c.25%) and a leading tile adhesive business (TAL, c.20%) - under a strong, autonomous leadership team. Post a disposal, we believe Norcros is in a strong position to accelerate expansionary ambitions subject to the right M&A opportunities arising. Furthermore, the company’s track record is strong in this regard. Over the coming 12-24 months we would expect to see a re-rating changing Norcros’ valuation, but for now our estimates and Fair Value of 397p / share remain unchanged.

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The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.

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Equity Development - Norcros - increased focus on driving UK/European potential