Norcros - Key strengths undervalued, legacy issues fixed

We believe that Norcros’s proven strategy remains on track, which should allow it to unlock significant market growth opportunities. We also believe that its key strengths are undervalued and that investors continue to underappreciate that most, if not all, of the legacy issues have been resolved. South Africa is now a large and rapidly growing part of the group, and the IAS 19R pension deficit has been eliminated. We value Norcros at 314p/share, implying c 45% upside.