I think a teacher can effectively manage up to three groups (this is being said by a former teacher) depending on how much time you are given for the particular lesson. I have seen teachers who start with whole group instruction (over all topic), then the groups rotate through centers for the remaining time (one center being small group with teacher). I do think once you have 5 or more groups it is a little hard to deal with.

...reading is pleasure, not just something teachers make you do in school.~B. Cleary