The Investment Column: First Technology

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The Independent Online
CAR-CRASH TEST dummy- maker First Technology hit a new high yesterday. Will it be a dummy run? First Technology is in the car comfort and safety business. It is developing devices that switch on headlights automatically when cars approach tunnels, and which prevent windows steaming up. It broadened its pipeline with the acquisition of US-based Control Devices Inc in March.

The market took against First Technology last year. Far Eastern sales of crash-test dummies declined. More recently, the market has questioned the value of CDI, which appeared to be dominated by low-growth activities of circuit-breakers and distribution. First Technology is now touring the City showing off what CDI has in development.

Among them is a patented in-car heating system, which it plans to sell for about $20 each to a European market of about five million units. But these are unlikely to hit the market for a couple of years. In the meantime, the core safety business, while offering little in the way of outstanding growth, should benefit from new legislation.

The shares closed up 20p at 448.5p yesterday. Analysts expect pre-tax profits of pounds 19.5m and earnings of 22.1p this year, putting them on a forward p/e of 20. The upside to First Technology is some way off and the shares are fully valued.