Tomkins to boost operational outlook in the next 12 months: Morgan Stanley

London - The operational outlook of Tomkins plc will improve in the next 12 months and the company's earnings per share (EPS) will grow by 14 percent in 2008, according to predictions by investment bank Morgan Stanley & Co International.

The bank predicted Tomkins - a British conglomerate that operates in the automotive and building products industries - would grow its EPS by 4 percent in 2006 and 12 percent in 2007 and upgraded the company's risk/reward balance from equal-weight to overweight.

Morgan Stanley predicted three percent ''GDP-style'' growth in 2007 and 2008 for Tomkins's automotive aftermarket sector due to a focus on new products.

Growth in the company's total original equipment manufacturer (OEM) sector was predicted to fall by one percent in the second half of this year but grow by 1.3 percent each in 2007 and 2008.

Growth in OEM sales to Ford, General Motors and DaimlerChrysler in the US would fall by five percent in the second half of 2006 and one percent each in 2007 and 2008 while other OEM sales would grow by 2 percent this year and three percent each in 2007 and 2008, Morgan Stanley predicted.

The bank tipped Tomkins's industrial OEM business to grow by 10 percent in the final six months of 2006, seven percent in 2007 and 4 percent in 2008 and its industrial aftermarket unit by four percent each in 2007 and 2008.

Morgan Stanley underlined Tomkins's improvement in remote tyre pressure volumes, return to profitability of the wipers business and strong growth in China and India as having a positive impact on the company's growth.

However, the bank identified raw material prices, moves in the dollar-pound exchange rates and a decline in next year's truck markets as possible negative impacts.